Profile - First Heritage
Co-operative Credit Union Limited
THE CREDIT UNION MOVEMENT LOGO
The “hands, family and globe” symbol, represents credit unions worldwide. This trademark represents credit unions in any language. The theme is universal and conveys the image of all credit unions.
THE GLOBE - This represents the international network of credit unions.
THE FOUR SILHOUETTES - This represents the family of mankind working for the mutual benefit of all.
THE HANDS -This represents the self-help nature of credit unions.
8
9
10
11
12
13
MINUTES OF THE 10TH ANNUAL GENERAL MEETING OF FIRST HERITAGE CO-OPERATIVE CREDIT UNION LIMITED HELD HYBRID ON THURSDAY, MAY 19, 2022 AT
THE JAMAICA PEGASUS HOTEL
81 KNUTSFORD BOULEVARD, KINGSTON 5
1. ASCERTAINMENT OF QUORUM AND CALL TO ORDER
The Chairman, Mr. O’Neil W. Grant, welcomed all and noted that the meeting was being held via hybrid format, With 51 persons physically present and 64 persons on the virtual platform, the Chairman called the meeting to order at 3:00 p.m. having ascertained a quorum.
He then invited the Board Secretary to read the notice convening the meeting.
2. NATIONAL ANTHEM AND INVOCATION
The Chairman asked all to stand for the playing of the National Anthem. He then invited Miss Michelle Tracey, Assistant General Manager - Marketing, Communications & Member Experience to lead the meeting in prayer.
3. OPENING REMARKS, APOLOGIES AND TRIBUTES
The Chairman conveyed that the Annual General Meeting was being held on the cusp of the 10th year of the existence of First Heritage Co-operative Credit Union Limited which was borne out of the amalgamation of Churches, GSB and St. Thomas Co-operative Credit Unions.
He noted that the Credit Union lost a number of its members to COVID-19 and asked all to stand and observe a minute’s silence for the members who made their transition.
14
The Chairman then invited the Board Secretary, Mrs. Tamara Francis Riley-Dunn, to welcome the specially invited guests.
Mrs. Francis Riley-Dunn extended a warm welcome to the following persons:
Mr. Errol Gallimore
Sheryll Brown
Karen Little
Nichole Bruce
Robin Levy
Vera Lindo
Department of Co-operatives and Friendly Societies
Department of Co-operatives and Friendly Societies
Department of Co-operatives and Friendly Societies
CUNA Caribbean Insurance Jamaica Limited
Jamaica Co-operative Credit Union League Limited
Jamaica Co-operative Credit Union League Limited
Claudette Christie Jamaica Co-operative Credit Union League Limited
Rochelle Stephenson KPMG
Apologies for absence were received from the following persons:
Ms. Judith Wright
Ms. Georgia Morrison
Mr. Dewayne Mullings
Mrs. Tracey-Ann Robinson Huie
Mr. Adrian Lyons
Ms. Denise Donna Mitchell
The Chairman then introduced the following Directors, Volunteers and the Chief Executive Officer: Directors
Mr. Cranston Ewan Treasurer
Mrs. Tamara Francis Riley-Dunn
Board Secretary
SSP Michael James Assistant Treasurer
Mr. Edmund James
Mr. Balvin Vanriel
15
Mr. Kevin Forbes
Mr. Noel Francis
He noted that Mrs. Leodis Douglas was online.
Credit Committee
Mrs. Althea Daley
Mr. Donald Williams
Mr. Richard Ranger
Supervisory Committee
Ms. Shauna-Kaye Gordon
Executive Leadership
Ms. Roxann Linton Chief Executive Officer
And himself as Chairman of the Board of Directors.
4. READING & CORRECTION OF THE MINUTES OF THE 9TH AGM
The Minutes were taken as read on a motion moved by Director, SSP Michael James and seconded by Member, Mr. Richard Ranger.
The Board Secretary went through the Minutes commencing at page 16 through to page 34.
There being no corrections, the Minutes were unanimously confirmed on a motion moved by Member, Ms. Charmaine Allen and seconded by Member, Ms. Clivia Green.
5. MATTERS ARISING FROM THE MINUTES OF THE 9TH AGM
The Board Secretary drew the meeting’s attention to the item referred to by Member, A. N. Harris Esq.
16
under ‘Any Other Business’ where he reiterated the need for adequate parking spaces to be provided to the attendees and asked that the meeting be kept at venues where parking was available. She pointed out that they were now at the Jamaica Pegasus Hotel where adequate parking was available.
In relation to Member, Mr. Calvin Thompson’s point about not enough entertainment being provided, she assured the meeting that this would be provided throughout the meeting.
In relation to the third to last bullet point on page 4, Member, A. N. Harris Esq. queried what percentage readiness the Credit Union was at for BOJ regulation. The Chairman stated that though the Credit Union was ready it would be difficult to ascribe a percentage, but that they would continue to look at the processes and systems in preparation for the proposed regulation by the Bank of Jamaica.
Member, Mr. Michael Burke stated that the Credit Union Movement had not been militant enough with the Bank of Jamaica to let them know that the Movement did not want that level of regulation, and suggested that a committee of militant people be formed to ensure that the co-operative spirit in Jamaica was not destroyed. He noted that if such a committee was formed he would volunteer to be a part of it. He added that the people who were being corrupt were the ones to be regulated, but the Co-operative Movement should be left to regulate itself. The Committee, he stated, should not come from the Credit Union League but FHC members who would stand up and demand their rights.
The Chairman indicated that the Credit Union was part of a League that has a very strong lobbying component that had been having serious interface with the Bank of Jamaica over many decades; the most recent being a conversation with Minister Aubyn Hill where they went through some of the impediments and challenges likely to be faced.
6. BOARD OF DIRECTORS’ REPORT
The report was taken as read on a motion moved by Member, Althea Daley and seconded by Member, Charmaine Allen.
The Chairman stated that navigating the COVID-19 pandemic showed that the Credit Union once
17
again embodied the fabric of resilience.
FHC had its fair share of challenges given the general economic climate that prevailed worldwide, however, the hardworking Management Team, the Board of Directors, the right mindset, and the strategies employed ensured the Credit Union’s success during 2021.
The Chairman expressed his appreciation for the unwavering loyalty of our valued members during the trying times of the pandemic, and noted that the members continued to remain at the centre of all decisions and strategies employed by the Board and Management Team.
The Member Assistance Programme which was introduced during the pandemic, remained in effect to support members whose finances were negatively impacted by the economic disruption.
Focus was placed on the health, safety and wellbeing of members and team members during the period of the pandemic.
The Board of Directors, the Committees and FHC’s Executives continued their quest to drive the 2040 Vision, geared towards digital transformation, through the execution of the 2021/2023 Strategy Map. The Management Team was now examining how they conduct business with the aid of digital solutions which would give greater access to the various products and services.
The Credit Union performed creditably, closing the financial year 2021 with a positive performance. At the end of the financial year, the Credit Union generated a net surplus of $235.35 Million compared to $106.2 Million in 2020.
The asset base increased from $15.15 Billion in 2020 to $16.57 Billion in 2021.
In July of 2021, FHC Investments Limited (FHCIL) received its Member Dealer Licence enabling members to buy and sell stocks on the Jamaica Stock Exchange, thus, facilitating wealth creation amongst the membership.
18
The pandemic continued to have an effect on the members’ borrowing patterns, resulting in the leadership team carrying out tactical approaches to drive the growth of the deposits, loans and asset portfolios.
A robust risk and compliance approach was maintained throughout the year.
Despite the volatility of the financial markets stemming from rising inflation, high energy prices and supply chain disruption, FHCIL reported a net profit of $3.6 Million for the financial year ending December 2021 compared to a net loss of $5.2 Million the previous year.
The Credit Union and its subsidiary remained committed to its corporate social responsibility guided by 3 pillars, Youth, Education and Sports (Y.E.S.). A total of $1.75 Million was awarded to 37 recipients in the form of scholarships, bursaries and grants. The FHC Entrepreneurship Awards had been deferred to 2022 where grants amounting to a total of $1.5 Million would be disbursed to the awardees.
It was noted that the FHC Foundation and the FHC Credit Union together, donated one hundred tablets to the National Education Trust valued at $1.5 Million in 2020. Forty of these devices were allocated to children with special needs and the remaining sixty devices were donated to primary and secondary level students.
The Chairman, on behalf of the Board of Directors, expressed sincere gratitude and thanks to all members for their loyalty, dedication and continuous support over the year, and to the team members for their unrelenting focus, strident efforts and commitment to ensuring the Credit Union’s success.
He expressed the hope that with the uptake of the COVID-19 vaccine, the Government would incrementally ease the current restrictions, and businesses, including the Credit Union, would begin to return to a degree of normalcy.
The Board of Directors, he stated, was confident that the Management of the Credit Union would continue to focus on the strategic vision ensuring that the Credit Union remained solid.
19
Comments & Questions
Member, Mr. Michael Burke stated that he was happy to hear about the Stock Brokerage Licence as people would not be empowered until they own something which would cause the stress levels in the society to go down.
He indicated that for the last 10 years he had been a delegate from COK to the Jamaica Fishermen’s Co-operative, and suggested that First Heritage Credit Union takes steps to become a member of that co-operative so they could help them to get into the hotel industry which in turn would employ more people.
The Chairman stated that some of the initiatives that Member, Mr. Burke spoke of were being considered by the Jamaica Co-operative Credit Union League. He noted that the inclusion of other co-operatives under the umbrella of National Union of Co-operative Societies Limited (NUCS) was under active consideration, seeing that the League was now being transformed under the new legislation to become a special authorized Credit Union. In the interim, he noted that co-operatives could become members of FHC and engage the Micro & Small Business Unit so they could access micro-business loans for working capital support.
Member, Ms. Charmaine Allen endorsed Member, Mr. Michael Burke’s position and stated that the Credit Union should not take the suggestion that Member, Mr. Burke made lightly, in relation to the Fishermen’s Co-op and should seize the opportunity to assist them. She also added that the Credit Union needed to target the youth to begin saving at an early age. The Chairman assured her that her thoughts were aligned to that of the Credit Union, where the unbanked, underbanked and young people would now be able to get a foothold into the Credit Union. They would have an opportunity to be cultured and taught what it means to be a co-operator and incrementally become a full-fledged member. The Chairman noted that members would be asked to vote on a resolution to that effect later in the meeting.
Member, Mr. Wayne Jones commended the Leadership and team members of the Credit Union for its success over the past ten years. He noted that a significant number of younger persons were
20
exhibiting renewed interest in stocks and bonds, and that it was refreshing to hear that FHCIL was now branching out in that area. He recommended, that the Credit Union seek to deepen and broaden its participation in the market, paying close attention to the Millennial and Gen Z cohort and reviewing how the message was being packaged to attract them. The Chairman assured him that in looking at the member at the centre strategy, a strong component was the youth and that it was now expanded to look at the underbanked.
There being no further questions, the Board of Directors’ Report was unanimously adopted on a motion moved by Member, Mr. Wayne Jones and seconded by Member, Mr. Michael Burke.
7. MANAGEMENT REPORT
The Management report was taken as read on a motion moved by Director, Kevin Forbes, and seconded by Member, Althea Daley.
Ms. Linton expressed pleasure to once again meet with members face to face and acknowledged the strong representation online. She extended a warm welcome to all.
She acknowledged the presence of the FHC Board of Directors, invited guests from the Jamaica Co-operative Credit Union League and its member companies, the Department of Co-operatives and Friendly Societies, CUNA Caribbean Insurance Jamaica Limited, the Auditors from KPMG, the Executive Team, and other team members.
She stated that, despite the challenges that the Credit Union faced over the past two years, they were now powered up as they continued to raise the B.A.R., an acronym that was coined to challenge herself and team members to:
B - Be Aware - of changes that are happening in the members’ lives
A - Attitude - being flexible and embracing openness to change
R - Reimagine - continuously developing the capacity to understand how the Credit Union changes, and how it envisions a new way of operating; how the members interact with the Credit Union, and how the Credit Union plans for that transition going forward.
21
She noted that the AGM theme “POWER UP: Reimagining Possibilities” was a follow on from the Blast Off 2022 theme geared at energizing team members to raise the B.A.R.
She then highlighted the following:
That the team members were at the core of raising the B.A.R. so as to underpin their Member at the Centre mantra, and that she was proud of the ways in which over 250 team members, navigated through significant disruption and uncertainty, and responded to the members and communities while supporting each other.
That during the year a winning spirit was cultivated, despite the continuation of the COVID-19 pandemic, through the execution of a number of strategies.
A new event for 2021 was the introduction of a Kindness Week, where the week of November 8 to 12 was dedicated as FHC Kindness Week. Daily activities were undertaken to inspire acts of kindness among team members and persons with whom the Credit Union interacted. The week culminated with the handover of a cash donation to the Jamaica Legion Poppy Appeal towards food and medical care for military veterans.
Team members received the appropriate training and development to enhance their performance and broaden their scope of knowledge in critical areas of operation.
Training was also provided to team members, as it related to the new and imminent Data Protection Act that the Credit Union would be required to comply with.
A structured Leadership Development Programme was launched in recognition of the need to improve the strength of the branch leadership. This resulted in a new Branch Management Leadership Development Training Programme being launched in July. The curriculum focused on both technical and non-technical aspects of branch leadership.
22
The Credit Union was deeply shaken and saddened by the passing of two team members, Mrs. Dawn Edwards and Mr. Michael Williams; condolences were extended to their families.
The management team and team members continued to focus on our Member at the Centre ethos in a bid to continue to deliver an exceptional member experience where focus was placed on members’ needs and identifying their challenges and hurdles, so as to build trust and confidence.
The Credit Union connected digitally through various social media platforms to retain constant contact with members, regarding our various product and service offerings. In addition, members were communicated with through emails and text messages. The CEO invited members who have changed their email addresses to advise the Credit Union of the change, so that their records could be updated.
During the pandemic the Credit Union also communicated with its members through the monthly ‘Feeling the Joy’ webinars where it offered hope, joy and encouragement to the members along with useful financial information.
The Credit Union continued to maintain contact with civil servants through the staging of the Civil Servants of the Year Awards 2021. The CEO congratulated the winners, Ms. Andrene Davidson of the Jamaica Information Service, Mr. Ronald Frue of the Administrator General’s Department and Mr. Clayton McCalla of the Ministry of Health and Wellness.
Despite the movement restrictions, the Credit Union was able to host a Member Appreciation Day. These activities included a webinar under the theme ‘Helping Entrepreneurs Advance’, hosted by the FHC in collaboration with the Development Bank of Jamaica and other entities.
Members were reminded and encouraged to use the alternate channels to do business such as online banking via iTransact, to utilize their AccessPlus Debit Cards and very soon to be introduced AccessPlus Debit Mastercard. Members were also informed of other alternate banking mechanisms through Bill Express and electronic bank transfers.
23
In December 2021 the Credit Union hosted a ground breaking ceremony for the new St. Thomas branch, scheduled to be completed in the latter part of 2022. This is in preparation for the expected economic growth and development in that parish; and to provide existing members with a more comfortable and appealing experience.
Members were asked to enquire and learn more about the Family Indemnity Plan and the Family Critical Illness Insurance Plan; products offered by CUNA Caribbean Insurance for final expenses for themselves or their loved ones.
The Member Assistance Programme introduced during the pandemic continued, where members are accommodated through moratoria, reduced fees and other waivers.
Members continued to be provided with opportunities for restructuring and consolidation of their loans in order to strengthen their financial positions. Members having financial difficulties were urged to seek dialogue with the Credit Union so a solution could be arranged.
It was noted that the Credit Union was in the implementation stage of establishing governance structures to support the business continuity of its operations. Those plans are soon to be retested.
The Credit Union’s financial discipline, risk management culture, as well as a robust capital position, provided a solid foundation for growth during the year. FHC’s overall performance in 2021 demonstrated a positive progression reflecting solid results, which gave rise to a net surplus of $234.35 Million and disbursements totalling $4.17 Billion for the period.
In closing the CEO expressed gratitude to the members, team members, Board of Directors and Volunteers who worked tirelessly to ensure that the year was a success.
She expressed confidence that, equipped with a clear vision, strength and adaptability, the Credit Union would continue to leave an indelible mark on those it serves.
24
The floor was then opened for questions.
Member, Mr. Michael Burke commended the CEO on a comprehensive report. He recommended that going forward the CEO should make it known that FHC interfaces with the membership personally and not predominantly through digital mechanisms as occurs at a number of other financial institutions.
Member, Ms. Hanna Dixon commended the CEO for a good report, but noted that emphasis was being placed on the younger generation; and though she was not resisting digitalization, some members like herself who had been with the Credit Union for over forty years, do not know how to use these systems. She suggested that in each branch an officer be placed on the floor to deal with the older members. The CEO assured her that they were committed to not leaving any member behind and would be working with the different member cohorts to educate them as service delivery channels change and further assured her that the eleven locations are staffed to support members of differing ages.
Member, Ms. Loreen McDonald complained about the Portmore Branch which she stated needed upgrading and more tellers so as to reduce the wait time. The CEO undertook to look into the situation and make the necessary improvements as needed.
Member, Ms. Loreen McDonald then queried why the receipt from the ATM did not state the outstanding balance on the account as normally obtains. The CEO informed the meeting that due to the prevalence of fraudulent and criminal activity, the transaction receipt no longer stated the balance in the account and that members wishing to get their balances could talk to a Member Service Representative.
Member, A.N. Harris Esq. stated that he did not have online access to retrieve his Annual Report booklet and review it ahead of the Annual General Meeting. He queried whether the printed copies could be had at least two days before the meeting. The CEO stated that is was the team’s modus operandi to make the Annual Reports available in advance, but they were not able to maintain the standard due to some minor challenges that they encountered and apologized for the inconvenience.
25
There being no further questions the Management Report was unanimously approved on a motion moved by Director, Balvin Vanriel and seconded by Member, A. N. Harris Esq.
8. AUDITORS’ REPORT
The Chairman invited the representative from KPMG to present an abridged version of the Auditors’ Report.
The Auditor, Ms. Rochelle Stephenson, stated that in their opinion the accompanying financial statements gave a true and fair view of the financial position of the Credit Union and the Group as at December 31, 2021, and of the Group’s and Credit Union’s financial performance and cash flows for the year then ended, in accordance with International Financial Reporting Standards (IFRS) and the Co-operative Societies Act.
The Chairman thanked Ms. Stephenson for taking the meeting through the Auditors’ opinion.
9. TREASURER’S REPORT
The Chairman invited the Treasurer Mr. Cranston Ewan to present the report for 2021.
The Treasurer’s Report was taken as read on a motion moved by Mrs. Carian Freckleton Cousins, Legal Counsel and Corporate Secretary and seconded by Director, SSP Michael James.
He highlighted the following:
For 2021 a surplus of $234.35 Million was realized compared to $106.20 Million the previous year and for FHC Investments a profit of $3.63 Million was realized after taxes as compared to the prior year’s loss of $5.23 Million. The year’s performance resulted in an accumulated surplus of $364.44 Million accruing to the Credit Union. Loan disbursements totalled $4.17 Billion, while increased savings contributed favourably to liquidity during the year. The Past Due rate moved from 8.79% to 7.97%.
26
The Treasurer drew the members’ attention to the revenue chart which showed a consistent increase in revenue for the Credit Union since 2017 of $1.39 Billion to $1.99 Billion in 2021.
Net surplus he noted, showed a consistent improvement with the exception of 2020 during the heights of the COVID-19 pandemic. He reiterated that for 2021 a surplus of $234.35 Million was recorded compared to $106.20 Million the previous year.
Total assets as at December 31, 2021 stood at $16.57 Billion which represented an increase of 9.34% over the previous year of $15.15 Billion.
Total assets of the Group totalled $16.6 Billion compared to $15.24 Billion over the previous year representing a 9.31% increase. The Group’s net loan increased by 6.61% or $620.37 Million over the prior year from $9.38 Billion to $10 Billion.
Liquid assets and investments grew by $885 Million moving from $4.6 Billion to $5.48 Billion.
Members’ deposits and voluntary shares increased by $1.32 Billion or 11.06% up from $11.95 Billion to $13.27 Billion in 2021.
He gave a brief overview of the economy showing that estimates from the Statistical Institute of Jamaica indicated that the Jamaican economy grew 4.6% in real GDP year over year for 2021. The Jamaican dollar depreciated against the United States dollar by 8.72%. The unemployment rate as at October 2021 stood at 7.10% compared to 10.7% as at October 2020.
With respect to the regulatory environment, preparations continued in anticipation of supervision by the Bank of Jamaica; the Jamaica Co-operative Credit Union League continued to monitor the Credit Union’s performance against international credit union industry and financial benchmark standards.
The Treasurer reported that the institutional capital to total assets ratio stood at 9.86% as at December 31, 2021 which compared favourably to the minimum PEARLS standard of 8% and 6% for the BOJ. Interest income of $1.65 Billion increased by $104.94 Million or 6.79% from $1.55 Billion in 2020.
27
Non-interest income of $334.19 Million increased by $106.78 Million or 46.9% compared to $227.4 Million the previous year.
Past Due loans as a percentage of the gross loan portfolio for the period, was 7.79% and provision for loan losses for the year net of recoveries, was $161.21 Billion in 2021 relative to $173.98 Billion in 2020. Accumulated surplus available for distribution increased to $364.44 Million from $280.25 Million which was an improvement of $84.2 Million over 2020.
In conclusion, Treasurer Ewan stated that the Credit Union’s performance for 2021 was highly commendable, and that the capital and liquidity positions remained adequate and above the benchmark. He noted that the improvements seen were a direct result of the commitment to the execution of the strategies that were presented at the Strategic Meeting.
He extended thanks to the Board of Directors, Volunteers, Management and Team Members led by CEO Ms. Roxann Linton and the Finance and Treasury Unit headed by Mr. Emil Williams and his team. He extended gratitude to the Auditors, KPMG and the loyal members of the Credit Union.
The floor was then opened for questions. Member, A.N. Harris Esq. noted that the Treasurer’s Report should have been presented before the Auditor’s Report in keeping with the agenda.
There being no further questions, the Treasurer’s and Auditor’s Report were approved on a motion moved by Member, Ms. Charmaine Allen and seconded by Member, Ms. Debbie-Ann Edwards.
10. DISTRIBUTION OF SURPLUS
The Treasurer tabled the Distribution of Surplus as presented in the Annual Report, which was circulated previously to all members outlining the distribution of $364.442 Million surplus for 2022 as follows:
28
Dividend on Permanent Shares (7.50%) $24.428 Million
Special Donation to the FHC Foundation $1 Million
Retained Earnings Reserve
Retained Earnings (closed accounts and others)
Accumulated Surplus
Million
Million
This was unanimously approved on a motion moved by Member, Ms. Charmaine Allen and seconded by Member, Mrs. Juven Montague-Anderson.
11. MAXIMUM LIABILITY
In keeping with the rules of the Credit Union, it was proposed by the Treasurer that the Maximum Liability be fixed at 20 times that of the Credit Union’s share capital.
This was unanimously approved on a motion moved by Volunteer, Ms. Shauna-Kaye Gordon and seconded by Director, Mrs. Leodis Douglas.
12. SUPERVISORY COMMITTEE REPORT
The report which was presented by Ms. Shauna-Kaye Gordon was taken as read on a motion moved by Member, Ms. Jillian Gayle and seconded by Member, Ms. Stephanie Radway.
Ms. Gordon shared that the theme “Power Up, Reimagining Possibilities”, meant that this was the year for wealth creation, and asked that all members whether in their youth, soft sixties or seventies stay connected to their Credit Union.
The Supervisory Committee, she stated, assists the Board of Directors in the discharge of its responsibilities, by providing oversight on aspects of the internal control system through the internal audit functions.
29
Honoraria $2.7 Million Donations $1 Million
$19.836 Million
$21.381
Retained Earnings Reserve $125 Million
$169.97
She introduced the members of the Supervisory Committee who were present, namely: Ms. Jacqueline Roberts, Ms. Tanisha Thompson and introduced herself, Ms. Shauna-Kaye Gordon, as Committee Chairperson.
She then highlighted the following:
There were seven audits outlined on the 2021 audit plan; the target completion rate was 70%, while the actual completion rate was 57%. She attributed the low completion rate to the redeployment of resources to a major special investigation, as well as the reduction in staff complement from 5 to 4 persons.
The four audits completed were:
1. Compliance with the liquidity and capital management policies;
2. Compliance with the loan origination, underwriting and disbursements service level agreements;
3. Review of the purchasing process for IT expenditure; and
4. Loan security management
The two audits that were incomplete or in progress at the end of 2021 were:
1. The follow up review of the Management Team’s corrective action on a major special investigation case
2. The review of the anti-money laundering and counter financing of terrorism framework
She noted that the Business Continuity Plan review was deferred.
She projected on screen a graph depicting a summary of the completed audits, showing that, of the 14 audits carried forward from 2020, 11 were completed and 3 were in progress with a completion rate of 70%. There were 31 new cases, of which 20 were completed and 11 in progress with a completion rate of 65%.
30
In relation to the bank reconciliation review, the Committee noted that the bank reconciliations were reviewed in a timely manner, and reconciled items were appropriately addressed.
Ms. Gordon also indicated that there were no team members, Volunteers or connected party loans that were outstanding for more than 30 days.
In concluding she extended thanks to the Nominating Committee for nominating the members of the Supervisory Committee, the members of the Credit Union for their trust and confidence in the Supervisory Committee, the Management Team and team members, the Internal Audit Department and the Board of Directors for their continued support.
There being no questions the Supervisory Committee Report was adopted on a motion moved by Member, Ms. Stephanie Radway and seconded by Member, Ms. Charmaine Allen.
13. CREDIT COMMITTEE REPORT
The Report, which was presented by Mrs. Althea Daley was taken as read on a motion moved by Member, Ms. Hanna Dixon and seconded by Member, Ms. Charmaine Allen.
She introduced the following members of the Committee and asked them to stand and be recognized, Mr. Richard Ranger, Mr. Donald Williams, Ms. Clivia Green, Mr. Stennett McLean and herself, Althea Daley, Chairperson of the Committee.
She highlighted the following:
For the financial year 2021, the Credit Union experienced growth in the loan portfolio, albeit the fierce competition from other financial institutions, and the impact of the COVID-19 pandemic. Disbursements totalled $4.27 Billion in 2021 compared to a total of $4.21 Billion in 2020. The loan portfolio grew by 6.76%, moving from $9.77 Billion in 2020 to $10.4 Billion in 2021.
31
Ms. Daley also highlighted that, the Past Due rate decreased from 8.79% as at December 2020, to 7.97% as at December 2021. For the Micro and Small Business Loan Portfolio, she reported that the unit saw a decrease in total disbursements from $394.16 Million in 2020 to $256.82 Million in 2021, a decrease of $137.34 Million or 34.84%. The Past Due rate for that portfolio increased to 30.27% in 2021 when compared to 17.56% in 2020.
The Committee extended thanks to the members for their assistance in reducing the overall Past Due rate, and encouraged them to pay their loans in a timely manner; she encouraged those experiencing difficulties to come in and speak with a team member.
In conclusion, Ms. Daley thanked the Board of Directors, the FHC team members, the Supervisory Committee and the valued members for their support. She noted that three members of the Committee would be retiring at this meeting, and on their behalf, she thanked the members of FHC’s Management Team and staff for the professional and caring manner with which they had been treated over the period.
There being no questions, the Credit Committee Report was accepted on a motion moved Member, Mr. Wayne Jones and seconded by Member, Ms. Eunice Campbell.
14. RESOLUTION - Starter Membership Tier
The resolution having been circulated was taken as read, on a motion moved by Member, A.N. Harris Esq. and seconded by Member, Mrs. René Gayle-Roper; the Board Secretary then took the meeting through the exercise of passing the resolution.
Mrs. Tamara Francis Riley-Dunn noted that the special Resolution being put forward was aligned with the discussions on the floor, as it sought to create a tier of membership that would facilitate an easier transition to financial access for young adult students, and the most vulnerable in the society. She advised, that the starter membership tier would target students aged 18 to 24 years and persons who were unemployed or low-income earners. The aim was for there to be a 3 year period whereby, these persons would be within the fold of the Credit Union and would be able to save. At the end of this 3 year period they would be transitioned to full membership.
32
The resolution sought to:
• Add sub-rule (iv) after Article III, Rule 5 (a) (iii) - This would amend the rules which currently provide for persons to qualify for membership with an entrance fee of $700 or any amount that may be prescribed by the Board of Directors from time to time, and subscribing to Permanent Shares with a nominal value of $2,500 or such amount that may be determined from time to time. This would now be amended to reflect a non-refundable entrance fee of $250 instead of $700, a nominal value of $500 instead of $2,500 in Permanent Shares, along with payment of $250 for Ordinary Shares to quality for “Starter Membership”.
Amend Article III, Rule 5(b) (iii) - Which speaks to the relaxation of the requirement for a national identification with photograph; given that this has been a challenge faced by some persons.
• Amend Article IV, Rule 6 - To allow an account number to be assigned to these “Starter Members”. This would also allow the “Starter Member” to resign his or her membership, by withdrawing their ordinary shares and disposing of Permanent Shares, by selling them to another member in keeping with Rule 14.
• Amend Article IV, Rule 9 - Which presently outlines that a person ceases to be a member on death or on ceasing to hold at least $2,500 in Permanent Shares; provided the Credit Union shall issue a 3 month notice. The rule would now be amended to include cessation of membership for “Starter Members” who hold less than ‘$500’ in Permanent Shares.
The floor was then opened for questions.
Volunteer, Mrs. Althea Daley enquired whether the $500 was going to be universal or if it was just for the starter members.
The CEO stated that this was solely for the purpose of onboarding “Starter Members” who were financially challenged and could not afford the standard $2,500, hence the 3 year period for them to amass the $2,500, enabling them to convert to the standard membership.
33
Volunteer, Mrs. Althea Daley stated that she did not understand the amendment speaking to a tiered membership which was further explained by the CEO and the Secretary.
Queried by Member, A.N. Harris Esq. as to how much the “Starter Member” would be paying initially, Mrs. Francis Riley-Dunn, stated that the person would be paying a $250 entrance fee, $500 for Permanent Shares and $250 for Ordinary Shares in order to qualify for membership; she then directed him to the second paragraph on Page 4, which gave a breakdown.
Member, Ms. Janyce Robinson asked for an explanation for amending Article lll Rule 5(b)(iii) speaking to providing a valid national ID with photograph, versus providing a non-governmental ID with photograph.
Mrs. Francis Riley-Dunn stated that from research conducted, it was found that a lot of persons do not have a national ID and cited an example where when the Government was giving out grants at the initial stage of COVID-19, and persons could not collect the grant as they did not have a Government issued ID. She noted that Government IDs are issued on the premise that one presents a proof of address. Acceptance of non-governmental IDs would therefore make it easier for persons who were not documented in that manner to enter into membership. The CEO added that these rules would enable the Credit Union to operationalize its due diligence processes.
Volunteer, Ms. Shauna-Kaye Gordon asked whether the photograph ID would need to be certified. Ms. Linton responded that standard operating procedures would be maintained, where copies made of IDs when opening accounts are required to be certified.
Mrs. Francis Riley-Dunn then invited the Registrar, Mr. Errol Gallimore to lead the voting exercise.
Mr. Gallimore stated that it was a pleasure to be in attendance. He then noted that there were 103 persons online and 88 persons physically present, making it 198 persons in all. It would therefore require 143 persons voting in favour of the resolution for it to be passed.
34
He informed the meeting that these rule amendments were rigorously vetted by his office and numerous discussions were had, which convinced him that the resolution was a practical step and would attract new members. He advised the meeting that this was a historic occasion, as no other Credit Union had yet put this in place and he expressed the hope that this would be carried by the news media. Mr. Gallimore stated, that this would be sending the message loud and clear to the Credit Union Movement that the time has come to create avenues for young people and the less advantaged to join the Credit Union Movement as “Starter Members” and thereafter transition to full membership.
He took the meeting through the voting process and at the end of the tallying of votes, 60 persons online and 87 persons present voted in favour of the resolution, making a total of 147 for, none against and 43 abstentions.
Mr. Gallimore declared the resolution as passed.
The Chairman thanked Mr. Gallimore for taking the meeting through this exercise.
(At this juncture the meeting was entertained by a musical interlude)
15. NOMINATING COMMITTEE REPORT
The Secretary presented the Nomination Report which was taken as read on a motion moved by Director, Mr. Edmund Jones and seconded by Director, Mr. Noel Francis.
Mrs. Francis Riley-Dunn highlighted that the custom was to have a 9 member Board but for 2021 it was recommended that this number be increased to 13 members because as of 2023, 5 longstanding Board Members would be retiring. By so doing this would ensure that the Credit Union’s business benefits from the experience of these 5 persons who would be demitting office, by creating a one year period for new entrants to experience the transfer of knowledge and in light of that, four persons had been recommended to join the Board in addition to its current complement of nine. She then introduced the four persons to include Mr. Wayne Jones, Mrs. Camille Ricketts-Moore, Mrs. René
35
Gayle-Roper and Mr. Richard Ranger whose profiles, she noted, were provided on pages 179 and 180. She indicated that this would require 50% of the members in attendance voting in favour of this recommendation, in order have it passed.
Instructions were given as to the voting procedure. She pointed out that 79 persons were in the virtual space while 87 were present in the room. At the end of the voting process, with 39 members online and 84 members in the physical space voting in favour of the recommendation; 2 against and 3 abstaining she declared the recommendation passed. Mr. Wayne Jones, Mrs. René Gayle Roper and Mrs. Camille Ricketts-Moore would serve for a period of two years while Mr. Richard Ranger would serve for one year.
Supervisory Committee:
Mrs. Francis Riley-Dunn stated that 3 sitting members would be retiring and the Committee had nominated Ms. Shauna-Kaye Gordon, Ms. Tanisha Thompson, Ms. Jacqueline Roberts, and Mrs. Carol Dallas-Robinson.
Credit Committee:
Retiring were Mrs. Althea Daley, Mr. Stennett McLean and Mr. Donald Williams and nominated were Mr. Donald Williams who would serve two years, Ms. Keslyn Gilbert would serve the remaining one year left on Mr. Richard Ranger’s term, Mr. Earl Bailey and Ms. Janyce Robinson would serve two years. The meeting was directed to their profiles on pages 180 – 184.
The Registrar, Mr. Gallimore, was asked to conduct the elections.
16. ELECTION
Mr. Gallimore congratulated First Heritage Credit Union for the strides it had made over the past year resulting in Total Assets moving from $15 Billion to $16 Billion and the surplus made, and congratulated the leadership, consisting of both the Board and Management Team, for their efforts.
36
He noted that the motion to increase the Board complement for one year had his blessing and support. He challenged the Board to make this the last year where they take nominations from the floor, a position that his Department had been advocating for the past five years. He pointed out that approximately 18 credit unions had made the necessary rule amendments to date and that the time had come for them to have a pool of persons with the type of skill sets needed, from which to elect persons to serve on the Board and various committees. He assured the meeting that nobody would be disenfranchised in terms of their right to nominate who they want and to be able to vote, and that it was just a matter of the process being dealt with in a structured way.
Board of Directors:
Mr. Gallimore laid out the ground rules that the election would follow both for those present and those online.
Nominated were Mr. Cranston Ewan, Mr. Balvin Vanriel, Mr. Noel Francis and Mrs. Leodis Douglas. He asked if there were any other nominations from the floor three times and hearing none, he asked that a motion be moved for all the persons recommended by the Nominating Committee to be accepted.
The motion was moved by Member, Ms. Jacqueline Roberts and seconded by Member, Ms. Lillian Lewis McDonald.
Supervisory Committee:
Nominated were Ms. Shauna-Kaye Gordon, Ms. Tanisha Thompson, Ms. Jacqueline Roberts, and Mrs. Carol Dallas-Robinson for a term of one year. Mr. Gallimore then asked three times for any other nominations and hearing none, he asked for a motion to be moved to accept these persons.
The motion was moved by Member, Ms. Althea Daley and seconded by Director, Mr. Edmund Jones.
37
Credit Committee:
Nominated were Mr. Donald Williams to serve two years, Ms. Keslyn Gilbert, one year, Mr. Earl Bailey, one year and Ms. Janyce Robinson, two years. Mr. Gallimore then asked three times for any other nominations from the floor and hearing none, he asked for a motion to be moved to accept these persons.
The motion was moved by Member, A. N. Harris, Esq. and seconded by Member, Ms. Paulette Lewis.
Delegates to the League and Various Other Agencies:
He noted that based on the rules of the Credit Union, the Board would choose the delegates and alternate delegates to the League and other external agencies.
The Chairman thanked Mr. Gallimore for ably carrying out the election exercise.
17. ANY OTHER BUISNESS
Member, A. N. Harris, Esq. expressed pleasure with the venue inside and outside as it had adequate parking however, he noted that there were no refreshments provided and the water that was provided was cold water, and he did not get any room temperature water when he asked for it. He expressed the hope that he would be getting a vegetarian meal at the end and reiterated the need for provisions to be made for vegetarians at these events. He congratulated the Chairman on the conduct of the meeting which he described as superb.
Miss Michelle Tracey was then invited to take the meeting through the give-away exercise. The Chairman then invited the Board Secretary to give the vote of thanks.
38
18. VOTE OF THANKS
The Secretary thanked the Chairman for his efficient conduct of the meeting, Miss Tracey, whose prayer set the inspirational tone of the meeting, the team at FHC that was in charge of coordinating the AGM. She thanked the Jamaica Pegasus Hotel team for making the physical space comfortable, Krystal Clear Productions for making the first and true hybrid meeting seamless, and the loyal members who participated and voted on the historic resolution for the underbanked and underserved communities.
The Chairman in closing pronounced the blessings of the Lord on all and wished for those travelling, a safe journey.
19. TERMINATION:
The Chairman terminated the meeting at 6:40 p.m.
Tamara Francis Riley-Dunn Secretary, Board of Directors
39
Corporate Governance Statement
Internal Controls: We have instituted effective internal control mechanisms to safeguard the accuracy and integrity of our financial reporting, as well as the effectiveness and efficiency of our operations. We conduct regular internal audits and risk assessments to identify and address any control weaknesses and ensure compliance with policies and procedures.
Compliant Posture: We are committed to compliance with all applicable laws, regulations, and industry standards. We maintain strong relationships with regulatory authorities and proactively address any compliance or regulatory matters that may arise. We also have a comprehensive compliance program in place to ensure adherence to anti-money laundering (AML) regulations and other relevant laws.
Continuous Improvement: We are committed to continuous improvement and regularly review and update our corporate governance practices to ensure that they remain effective and aligned with our credit union’s strategic objectives, member needs, and regulatory requirements. We welcome feedback from our members, employees, and stakeholders and use it as an opportunity to learn, adapt, and improve our governance practices.
Member-Centric Approach: Our Credit Union exists to serve our members, and their best interests are at the forefront of our decision-making processes. We believe that member engagement is critical to understanding their needs, expectations, and concerns, and we strive to align our strategies and operations accordingly.
In conclusion, at FHC, we are dedicated to maintaining the highest standards of corporate governance to ensure the safe and sound growth of our Credit Union and to protect the interests of our members.
41
Mrs. Leodis Douglas is currently the Principal Lecturer, Head of Department (HOD) at the G. C. Foster College of Physical Education and Sport. Prior to that, she was the Director of Human Resources for 12 years at the institution.
Mrs. Douglas holds, amongst her many qualifications, a Masters Degree in Business Administration from Florida International University (FIU), a Bachelor of Science in Human Resource Management, graduating Summa Cum Laude and a Diploma in Education with Honors. She is also certified in Executive Management, Six Sigma Project Lean Processes and is Six Sigma Black Belt Certified.
Mrs. Douglas currently serves as the Chairman of the Board of Directors of First Heritage Co-operative Credit Union and is also the Chairman of the FHC Foundation.
42
Mr. Forbes is currently employed to Look Beyond Limited as a Financial Controller. He previously served as Financial Manager at Cable & Wireless Limited, Financial Controller at Allied Insurance Brokers Limited, and has worked in various management capacities within the Grace Kennedy Company Limited as well as Ernst & Young Caribbean.
He holds a Masters of Business Administration in Finance from the Manchester Business School, United Kingdom, is a Fellow of the Association of Chartered Certified Accountants as well as a member of the Institute of Chartered Accountants of Jamaica.
He is the 1st Vice Chairman of the Board of Directors.
Mr. Jones is a retired Civil Servant with his last post being Technical Support Manager at the Ministry of Finance and the Public Service. He currently does contractual work in both the Public and Private Sectors managing projects, teaching and consulting.
His volunteer service includes Directorships at Quality Networks Co-operative and the Jamaica Paralympic Association. He is also a Council Member of the Aquatics Sports Association of Jamaica.
He is the 2nd Vice Chairman on the Board of Directors and is the Chairman of the Merger and IT Steering Committees.
Mr. Ewan is currently the CEO of 138 Student Living Jamaica Limited. He is a certified accountant, a Fellow of the Association of Chartered Certified Accountants (ACCA) and holds a Master’s Degree with a concentration in Finance from the Manchester Business School (UK). Mr. Ewan has vast experience in several industries, spanning Accounting, Shipping, Education, Energy Efficiency, and the Distributive Trade. His expertise includes accounting, finance, management consulting, human resource management, facilities management and leadership.
He is presently the Treasurer on the Board of Directors, Director of FHC Investments Limited and the Chairman of the Finance and Operations Committee.
Mr. Vanriel is currently a Partner with the auditing firm BDO Chartered Accountants. He is a qualified Accountant, a Fellow with the Institute of Chartered Accountants of Jamaica and a member of The Association of Chartered Certified Accountants (ACCA).
Mr. Vanriel is also a Registered Public Accountant. He serves as an Associate Minister in his denomination.
He is the Assistant Treasurer on the Board of Directors and the Chairman of FHC Investments Limited. He is also a Past Chair of FHC Credit Union.
Mrs. Francis Riley-Dunn is a legal practitioner in Jamaica, having been called to the Bar in 2000. She specializes in commercial law (with an emphasis on debt collection), conveyancing and family law.
She is an honours graduate of the University of the West Indies and also of the Norman Manley Law School, where she received her Certificate of Legal Education.
She is the Secretary on the Board of Directors.
Mrs. Gayle-Roper is a Legal Consultant with a decade of experience as an Attorney-at-Law, working on high impact projects and cross border transactions. She previously held the position of AGM of Legal Affairs of First Heritage Cooperative Credit Union Ltd and possesses a wealth of knowledge in corporate and commercial law.
She is the recipient of many academic accolades and is the holder of a Bachelors of Law Degree (1st Class Honours), a Certificate of Legal Education (with Merit) and a Master’s of Science in International and Comparative Dispute Resolution (with Merit). She is the Assistant Board Secretary.
Mr. James is a Retired Senior Superintendent of Police, a former Executive Member of the Police Officers’ Association and Divisional Commander of St. Thomas. He currently serves as Chairman of the Paul Bogle High School Board of Management.
He has received numerous awards including the Medal of Honour for Meritorious Service, the Jamaica Constabulary Force Distinguished Service Award for the Development of Police Youth Clubs in Jamaica, as well as being named the LASCO Police Officer of the Year 2000. He is a Past President of the Kiwanis Club of St. Thomas. He is a Director of FHC Credit Union.
Mr. Francis, a Commissioned Land Surveyor and a Class 1 Hydrographer, is an Associate of the Royal Institution of Chartered Surveyors. His work experience includes the management of the Survey Department as Deputy Director of Surveys, serving as a consultant in Dredging Engineering, Consultant to the Commonwealth Secretariat and the United Nations and serving as a Lecturer at the University of Technology.
Educated at the University of the West Indies, University College London, University of Toronto, Texas A&M University and Nova Southeastern University. Mr. Francis’ qualifications include a Bachelor’s of Sciences Degree (BSc.) and a Master of Arts in Business Administration (MBA).
Mr. Francis currently serves on the Board of the Jamaica Copyright Agency as Treasurer and sits on the Past Due Committee of FHC as well as the Board of Directors. Mr. Francis has been honored by the Jamaican Government with an Order of Distinction.
Mr. Grant is the immediate Past President of the Jamaica Civil Service Association and has served as President since 2011. He has held several positions in various Ministries, and currently sits on the Board of the National Housing Trust.
He is a trained Accountant and Financial Analyst and currently holds an Executive MBA from the Mona School of Business.
He is a Director of FHC Credit Union and also sits on the Board of the Jamaica Cooperative Credit Union League Limited and the Consumer Affairs and Fair Trading Commission.
Mr. Jones currently holds the post of Deputy Financial Secretary in the Ministry of Finance and Public Service and is in charge of Strategic Human Resource Management. Mr. Jones is an accomplished Human Resource Practitioner with over thirty-five years’ of experience in the field of Industrial Relations and Employment Management. He is a graduate of the University of the West Indies, City & Guild Institute of London, and a certified Change Management Specialist.
Mr. Jones is a former President of the Jamaica Civil Service Association (JCSA) and General Secretary of the Jamaica Confederation of Trade Unions (JCTU). At the regional and international levels, he held the presidency of the Caribbean Public Services Association and sat on the Executive Board of Public Services International as representative of the InterAmericas Region. He is also the recipient of an Oder of Distinction by the Jamaican Government and is a Director of FHC Credit Union.
Mr. Ranger is a Chartered Accountant, a member of the Association of Chartered Certified Accountants (ACCA) in the United Kingdom and a member of the Institute of Chartered Accountants of Jamaica (ICAJ). He has over fifteen years’ of experience in external and internal auditing, accounting and business operations. Mr. Ranger has worked with PricewaterhouseCoopers, Boldeck Jamaica Limited and the Neal and Massy Group, specializing in audit and assurance, accounting and income tax services.
He is presently the Principal of Ranger and Associates and previously served as a volunteer in the capacity of a member of the Credit Committee. He is a Director of FHC Credit Union.
Mrs. Ricketts-Moore possesses over 18 years’ experience in the field of Accounting, Internal Auditing and General Business Operations, acquired mainly from the manufacturing, distribution and retail industries. She previously worked with the Grace Kennedy Company Limited for 11 years and is currently the Managing Director of Sangster’s Book Stores Limited.
Mrs. Ricketts-Moore is a Chartered Accountant and holds a MBA from the Manchester School of Business. She is also a Certified Information System Auditor (CISA) and a Certified Internal Auditor (CIA).
She previously served as a Volunteer in the capacity of Chairperson on the Supervisory Committee at First Heritage Co-operative Credit Union Limited and is a Director of FHC Credit Union.
48
The positive outcomes of the financial year 2022 underscored First Heritage Co-operative Credit Union Limited’s (FHC) resilience. As a united team, we showcased how a well-defined strategy and shared vision can yield exceptional results. Despite ongoing economic challenges due to the COVID-19 pandemic, the easing of restrictions locally and internationally led to increased social and commercial activities, driving higher demand for financial services. This, combined with the strategic prowess of the Board of Directors and Management, dedicated focus of our Team Members, and Volunteers, backed by the support of our loyal members resulted in another successful financial year.
The Credit Union concluded the year with a surplus and robust loan disbursements, reflecting our steadfast commitment to assisting members in achieving their goals through the people-helping-people philosophy. Throughout the year, FHC Credit Union prioritized enriching the member experience through tangible improvements. We successfully upgraded our core banking system and inaugurated a new branch office in St. Thomas, aligning with our Member-At-The-Centre ethos. This principle isn’t just a statement but a consistent practice, as our leadership team actively engages with members and clients to understand and fulfill their needs.
The Board remains inspired by the leadership team and team members’ unwavering dedication to providing top-notch service to members and clients. This commitment is expected to fuel further innovations, contributing to the ongoing success of our Credit Union.
FINANCIAL PERFORMANCE
The financial year 2022 concluded with positive results. FHC Credit Union achieved a Net Surplus of $184.25 Million as against $188.43 Million for 2021. Additionally, the Company’s asset base grew to $17.19 Billion, up from $16.45 Billion in 2021. The easing of the COVID-19’s impact on the economy led to increased demand for our services, particularly in the context of our loan products. Simultaneously, our leadership team concentrated on engaging the market with our deposit product offerings. A robust risk and compliance framework continues to be in place, to maintain and build member confidence. We are also continuing our preparations for readiness for the Bank of Jamaica’s (BOJ) imminent supervision of Credit Unions as well as aligning our organization for the implementation of the Data Protection Act.
49
STRATEGIC VISION
The Board of Directors, Committees and leadership team remained committed to realizing our 2040 Vision, through the execution of our 2021-2023 Strategy Map. We recognize that integrating technological solutions is crucial to enhancing our service delivery and attracting and retaining our young members, hence, our Member-At-The Centre approach remains central to our daily operations and initiatives.
OUR SUBSIDIARY FHC Investments Limited (FHCIL)
In 2022, Central Banks across the world started increasing interest rates to combat higher inflation. This environment of rising interest rates and inflation resulted in the prices of most global asset classes recording declines in the first nine months while major stock market indices entered a “bear market”. Annual (point to point) inflation by December 2022 stood at 9.4% and local interest rates rose significantly, with the Bank of Jamaica (BOJ) raising its benchmark rate to 7.0% to counter inflation. The exchange rate for the Jamaican dollar (J$) to the United States dollar (US$) as at December 31, 2022 was J$152.05 to US$1.
As inflation rose, yields on global corporate and sovereign debt followed, adversely impacting the value of these assets in the investment portfolios and reducing potential for trading gains. Furthermore, as global recessionary fears led to a substantial contraction in demand for investment products, fee-based income categorized under Other Income declined. This is in contrast to the prior year when investor sentiment was moderately high and interest rates were low. Resultantly, FHCIL reported a Net Loss of $23.5 Million for the year ended December 31, 2022 compared to a net profit of $3.6 Million reported for the same period in 2021. The decline in profitability was mainly attributable to a 21.58% decrease in Net Interest and Other Income, when compared with the prior year.
Despite these challenging macro-economic conditions and rising inflation, FHCIL achieved remarkable growth in Net Interest Income of 138.5% for the financial year under review, reaching J$15.22 Million. Other Income however decreased by 34% when compared with the prior year, due to the fair value losses on assets, particularly local stocks.
50
Funds Under Management declined by 22% year over year (YoY) from $4.43 Billion to $3.44 Billion. The general weakness in market conditions and lower asset prices tempered the growth in the assets under management, both in the fixed income and equity markets, when compared to the similar period last year. No significant deterioration in the credit quality of the company’s assets occurred during the financial year.
With strategic positioning to better serve its clients as a core focus, FHCIL saw advancement in its service offerings, having secured its Member Dealer License from the Jamaica Stock Exchange and outfitted the company with a new and modern website which will enhance Client capabilities.
The FHC Retirement Scheme experienced growth with 92 new members enrolled when compared with 83 in the prior year. Members’ contribution totaled $155.22 Million which was a 20% increase over the prior year, while net assets available for benefits decreased by 1% to end the year at $1.46 Billion.
Despite the current volatile economic and market conditions, FHCIL remains optimistic for the next financial year aiming to diversify its revenue streams and improve performance through expanded products and services.
FHC FOUNDATION
Following its establishment in 2013, the FHC Foundation has upheld its mission to promote the development of Jamaican youth through our three pillars Youth, Education and Sport. As avenues for advancement within our society evolve, the Foundation has sought to further streamline its core focus, which during the 2022 financial year was aligned to Sports Education as a core thematic area.
With this in mind, the FHC Foundation has mobilized this new focus through initiatives that will see the Foundation focusing on Sports Education amongst the youth population.
51
Over the period under review, we donated a total of $1.03 Million to 16 recipients as a part of our annual Scholarships, Bursaries and Grants, namely our Primary Exit Profile (PEP), Oswald Thorbourne and Renald Mason Scholarships.
Our Entrepreneur Awards grants valuing $1.5 Million were successfully awarded to the 2021 recipients, with the Programme being enriched to include, for the first time, an Incubator Programme which saw the awardees participating in a two day intensive coaching session with a certified Business Coach courtesy of the Credit Union.
The Foundation intends to support a student pursuing Sports Education at the tertiary level through a tuition scholarship for the 2023/2024 academic year at a value of approximately $500,000.
We congratulate all our beneficiaries, members and YOUTH Savers, and encourage them to continue to work hard.
52
RECOGNITION
The FHC Credit Union team continues to consistently uphold a high standard of performance, placing member satisfaction at the forefront. Despite persistent economic challenges, the team has adeptly addressed our members’ needs through innovative products and skill-building strategies. The Board of Directors extends gratitude to all our Directors especially, those who will retire following our 2023 Annual General Meeting. Additionally, we thank the Volunteers, our Affiliates, the Leadership team, team members of both FHC Credit Union and FHC Investments, as well as our loyal members and clients for their continued dedication and unwavering support. Your commitment has greatly contributed to our Credit Union’s ongoing success and we are indeed appreciative and sincerely thankful.
OUTLOOK
The economic resurgence and relaxation of restrictions during the year 2022 have paved the way for a successful 2023. Our business operations have thrived, and increased capacity bodes well for further success throughout the year at new levels, along with the incremental increase in capacity, which we anticipate will result in greater successes throughout 2023.
Our Member-At-The-Centre focus remains central and squarely in sight, evidenced through our diverse suite of offerings. We will maintain a close relationship with our members to facilitate the continuous enrichment of our services. We are dedicated to promoting and expanding financial inclusivity for our youth, the underbanked, and underserved and will progressively expand efforts in this direction.
The Board of Directors remains confident in the Leadership team’s commitment to realizing our strategic vision and perpetuating our legacy of a solid past and a secure future.
Leodis Douglas Chairman, Board of Directors
53
…………………………………………………..
Board Of Directors’ Report
54
Names Position Scheduled Attended Excused Leodis Douglas Chairman 10 10Kevin Forbes 1st Vice 10 10Chairman Edmund Jones 2nd Vice 10 9 1 Chairman Cranston Ewan Treasurer 10 10Balvin Vanriel Asst. Treasurer 10 9 1 Tamara Francis Riley-Dunn Secretary 10 8 2 René Gayle-Roper* Assistant 6 5 1 Secretary SSP Michael James Director 10 8 2 Noel Francis Director 10 9 1 Richard Ranger* Director 6 6Camelle Ricketts-Moore* Director 6 6Wayne Jones* Director 6 2 4
Attendance at Board of Directors meetings
*Elected May 2022
57
We entered financial year 2022, with a keen focus on raising the B.A.R. that is, by actively being aware of our members’ dynamic needs, lifestyle and desire to be and feel fulfilled; maintaining an attitude for success by being flexible and embracing openness to change as this is indeed, the only constant; and reimagining our Credit Union, by actively developing our capacity to consider what this institution looks like years from today, and laying the ground work to ensure a successful trajectory towards that future. We have successfully ‘POWERED UP and Raised the B.A.R.’, as evidenced by a year of notable accomplishments, namely:
• The upgrading of our core banking system to Smart Universa, which has enabled us to realize greater efficiencies in serving our members.
• Being the first individual credit union to acquire a Stockbrokerage Licence through our subsidiary FHC Investments; which has seen FHC broadening our service offerings and developing the capacity to support the more sophisticated financial needs our members.
• The historic passing of a resolution to effect a Starter Membership Tier, which will see the unbanked and young adult population aged 18 to 24 years old joining the Credit Union Membership with an opportunity to gradually progress to full membership
• On December 31, 2022, we relocated to our newly minted St. Thomas Branch, offering our members a significantly more spacious and comfortable environment within which to conduct their business and;
While we have acknowledged and celebrated these successes on various occasions, including during our 10th Anniversary celebrations which we commemorated in August 2022, we remain committed to striving for further excellence and are not limited by past achievements, but rather, have resolved to forge on to New Horizons to…Dream. Dare. Deliver.
FINANCIAL PERFORMANCE
The collective performance of the Credit Union for financial year 2022 spurs confidence. FHC retained a positive position as Jamaica, and countries globally, began to recover following the COVID-19 pandemic. By remaining focused on our strategic pursuits and carefully navigating the complex business environment, FHC continued to chart the path for a successful future. Our efforts generated a Net Surplus of $184.25
59
Million for the financial year; while providing financial support to our members through loan facilities with disbursements totaling $5.21Billion for the period.
OUR STRATEGIC PRIORITIES
During the 2022 financial year, our Credit Union gained further traction in the execution of its strategic initiatives. While we worked to continue to grow the success of our business and advance the services of FHC to better serve our members, we periodically evaluated our strategic priorities to ensure that these align with our 2040 Vision. It is our objective, to ensure that our strategies allow us to anticipate and respond to our business environment, and in turn enable us to satisfy our vision of creating avenues for financial freedom and development for our members. Being cognizant of this, we have maintained at the forefront of our minds, our core principle, ‘Member at the Centre’, with a view to taking a membercentric approach to all we do.
OUR VALUED MEMBERS Deepening Member Relationships
We are pleased to report that the financial year ended December 2022, was punctuated with significant positive milestones in our history. It was a period in which as a team we experienced much success, achieved amazing performance, we broke previous records, and surpassed aspirational targets. This was made possible by the exceptional resilience of our Sales Team strongly supported by our different teams across the organization.
The strategies designed and implemented, brought greater value to our members, thus ensuring that their needs and expectations were surpassed. The increased commitment of the team, with a clear understanding of the overall company objectives, goals, purpose, high morale and motivation, was the driving force of our success.
The general economic recovery of the private and public sectors continued during 2022 however, the progress for some sectors remained slow.
Despite the highs and lows of the varied experiences within the economy, the financial services landscape remained very competitive. Our loans and deposit portfolios experienced solid growth and our other
60
offerings remained attractive as we continued to provide real value to our membership. Our innovative and dynamic approach in our planning as the base of our culture and our sales and service framework and processes have also supported our success.
Promotional activities, collaborations and strategic partnerships with major business entities as well as forging and maintaining our relationship with public sector entities were the hallmarks of our activities. This has been driven by amplified collaboration between our Retail and Marketing Department which has served to strengthen our business development efforts to effectively penetrate previously underserved segments of our membership and target market. We capitalized on and practised our relationship building strategies which have effectively stimulated growth in key areas. The team was engaged in over 60 new business development opportunities which resulted in the development of a robust pipeline for the period under review and onwards.
Much of our interactions with our members for 2022 have remained online. We were successful in making contact with our prospects remotely utilizing virtual modalities as we continued to establish new relationships whilst maintaining the existing ones utilizing a targeted approach.
Our efforts continued as we collaborate internally and with external stakeholders to improve on and provide exceptional service to our members.
Member Engagement Activities
Retaining a strong connection with our members remained a key point of focus throughout the year. This helped to assure our membership that despite the challenges faced as a nation, as we sought to recover from the impact of the pandemic, we would continue to support them in their endeavours and provide solutions to meet their various financial needs. A blended engagement approach was utilized with face to face interactions increasing in light of the relaxation of the COVID-19 restrictions by the Government of Jamaica. Online interface however remained an active and useful engagement tool through webinars and presentation sessions.
Our staple activities undertaken throughout the period which supported our sustained relationship with our Members included:
61
Civil Service Week
Civil Servants of the Year Awards
As proud title sponsor of the 2022 FHC Civil Servants of The Year Awards, we had the pleasure of interacting with all shortlisted nominees and selected the following winners from the three categories:
NAME CATEGORY DEPARTMENT
Mr. Lennox Wallace Management Ministry of Health and Wellness
Mr. Oliver Morris Middle Management Ministry of Justice
Ms. Simone Turton Technical Support Ministry of Health and Wellness
Credit Union Week
A number of member appreciation activities were held across all branches throughout Credit Union Week, and culminated with our Evening At The Movies event on International Credit Union Day on October 20, 2022, where our valued members were treated to a film and refreshments courtesy of FHC.
FHC Christmas Show
Our Christmas Show was held virtually on Friday, December 16, 2022 with a blend of FHC Team Member talent, professional entertainers and friends of FHC. The show was a success and saw team members caroling along with the performers online as well as engaging with us via the chat.
Products, Services and Promotions
Our commitment to ensuring that our members were assured and supported continued. Despite our organization’s on-going navigation of the pandemic with a thrust towards recovery to pre-COVID service levels, our connection with our members remained robust.
We hosted our POWER UP! Women Winning Financial Goals in 2022 Webinar at the beginning of the year, and closed the year by welcoming our new Brand Ambassador for FHC Investments, Dr. Sara Lawrence Lewis. The partnership was launched with our webinar entitled FHC Investments Fireside
62
Chat which was well received both across our client and member base along with the general public. Both webinars sought to share key insights about how persons could amplify their capacity to propel their financial journey through prudent savings habits, establishment of a healthy investment portfolio and critically, retirement planning at an early age so as to ensure a high quality of life upon demitting the workforce.
Encouraging the use of our alternate banking channels remained a core focus of the Credit Union; our members’ safety remains of paramount importance, and equipping them with the knowledge and tools to facilitate the same has been a part of our ongoing thrust. Our alternate banking channels include our iTransact internet banking platform, AccessPlus Debit Mastercard, Bill Express Payment Services, as well as Electronic Bank Transfers. Through these channels, our members have twenty-four hour access to conduct business and process their transactions safely and conveniently.
Supporting our members with fit for purpose products and services has always been a part of our strategic focus as a Credit Union, particularly as our members’ needs evolve and become more sophisticated. In keeping with this, a number of promotional offerings were proffered throughout the year to suit every member and his/her needs; these included:
1. ‘Sweetest Summer’ Loan Sale – Our Summer loan sale provided our Members with an opportunity to reach their financial goals with greater ease by taking advantage of reduced fees, and preferred rates that were made available to them.
2. ‘Holly Jolly Chris’Max’ Loan Sale – The Credit Union continued to promote our loan products by making them more readily accessible and attractive to members and enable our membership to bring their dreams to life with FHC as their financial partner.
3. FIP/FCIP Referral & Rewards Promotion - Following a brief cessation in 2021 as a result of the impact of the pandemic, we piqued our members’ interest in the Family Indemnity Plan and the Family Critical Illness Insurance Plan, subsequent to their reactivation, with the FIP/FCIP Referral & Rewards Promotion, wherein 20 members were awarded gift certificates as our special way of rewarding them for accepting the offer and building member loyalty.
4. AccessPlus Debit Mastercard Launch - The Credit Union movement, led by the Jamaica Co-operative Credit Union League, has commenced the transition from our AccessPlus Debit Card to the AccessPlus Debit Mastercard. This forms part of our strategic focus to foster financial enablement and safety
63
through digital interventions. Our members were invited to change their existing AccessPlus Debit Card to the new AccessPlus Debit Mastercard which is safer, more convenient and allows for accessibility to and use of funds not just locally, but globally as well as online.
5. FHCIL Brand Ambassador Agreement – FHC Investments onboarded Dr. Sara Lawrence Lewis as its first Brand Ambassador. Through this partnership, her creative delivery of the brand’s key benefits and sharing about her firsthand experience engaging with the company, is expected to yield greater visibility for the brand and drive demand for our services.
6. Investment Summer Promotion – Our members and prospective clients were encouraged to commence their investment journey by participating in our special summer and Christmas offer which enabled new account holders to benefit from a 50% discount on both the amount required to open their account as well as the brokerage fees.
7. The Member Assistance COVID - 19 Relief Programme – Numerous offerings were extended to our members to help to buffer the many challenges that were being experienced. These included waivers, moratoria and other options.
OUR PEOPLE AND CULTURE
Our Perseverance
Our team continued to persevere through challenging times, readjusted to functioning in the new normal, and remained focused on achieving the objectives of the Credit Union, which resulted in us experiencing yet another successful year.
We kicked off the year with our “Blast Off” Event, which was held under the theme, POWER UP …Raising the B.A.R. Given the continued COVID-19 pandemic, a decision was taken to host this function in the virtual space, to ensure the safety of our team members.
We launched our Digital Transformation journey and the presentations made were centered around this initiative, commencing with a metaverse-themed presentation; in support of this, the event Guest Speaker, Mr. Trevor Forrest, CEO for 876 Technology Solutions presented on the topic “Shaping Our Digital Future” where he shared some of the current and future considerations for digitizing our business
64
to optimize our service delivery. As is customary, we also recognized and rewarded team members for their outstanding performance in 2021.
Our Learning & Development
Throughout the year, we equipped and developed our team members to function optimally and gain a competitive advantage in the financial sector. Some of the training initiatives which were undertaken during the year were:
1. Smart Universa Core Banking System Conversion Training
In preparation for the conversion of the Smart Universa core banking system, several training sessions and simulation activities were executed to ensure that team members were trained and ready to function in the new environment.
2. Fraud Awareness Sensitization (Detection & Prevention)
In our endeavour to bolster our Fraud Risk Management Systems and build team members’ awareness around fraud, we conducted several fraud awareness training sessions during the year, including the areas of Fraud Risk and Loan Fraud Documentation.
3. Anti-Money Laundering (AML) Compliance for Money Transfer Services
In accordance with Regulatory requirements, several team members within our Branch Network participated in the training and assessment workshops on Anti-Money Laundering (AML) Compliance for Money Transfer Services.
4. Leadership Development
As we continued to hone and develop the skills of our emerging leaders, a Leadership Development Training Session was held.
TEAM MEMBER EXPERIENCE & ENGAGEMENT ACTIVITIES
During the year, we hosted focus group sessions with team members within the various Branches and Departments, to ascertain how to improve their Team Member Experience, to ensure that they felt Respected, Rewarded and Recognized for their hard work and were Ready to undertake the Credit Union’s transformation journey.
65
In support of this, several social activities were hosted to ensure that our team members were kept engaged, energized and motivated. These included:
1.
Sports Club – “2-4-6” Event
Through the FHC Sports Club we hosted our first team member social engagement for the year, “24-6 – the HYBRID Edition”. It was an evening filled with fun, food, music and good vibes. Our team members welcomed the long-awaited celebration, where they got the opportunity to socialize in a physical space once again. We also provided the opportunity for team members within the wider branch network to join the event virtually.
2. Beach Party – “Summer Fun Under the Sun”
Team members came together in the physical space for a memorable engagement event – “Summer Fun under the Sun”. This was held at Laughing Waters, Ocho Rios, St. Ann. Over seventy five percent of the team member complement was in attendance. The day was filled with lots of fun activities which included the crowning of Miss and Mr. FHC Credit Union.
3. Theme Fridays
We hosted our customary Theme Fridays in commemoration of Black History Month, Jamaican Heritage, Breast Cancer Awareness Day, World Kindness Day and the Christmas Season.
4. FHC Kindness Week
In commemoration of World Kindness Day, we celebrated our Kindness Week, from Monday, November 7 through to Friday, November 11 2022, with an activity dedicated to each day that depicted Kindness,such as, making donations to vulnerable groups, expressing appreciation to team members and sharing tokens with one another.
5. Christmas Party - Glitz and Glam
To culminate the year’s engagement activities, we hosted an end of year team member event during the month of December, under the theme – Glitz and Glam, where team members were treated to a night of food, music and fun, for their hard work and dedication to the Credit Union.
66
FHC Investments Limited
The global economy was challenged throughout 2022 resultant to a number of disruptive activities taking place, the most notable impact drivers were the ongoing war between Russia and Ukraine, rising inflation, increasing interest rates and the resultant reduction in liquidity conditions in the market.
As such, FHC Investments Limited (FHCIL) recorded a decline in financial performance for the year 2022 which was primarily attributable to the challenging macro-economic conditions, however, the Company recorded positive growth of 138% over the corresponding period in Net Interest Income to J$15.22 Million for the financial year ending December 31, 2022. Other Income decreased by 34% when compared with the prior year, due to the fair value losses on assets, particularly local stocks. Net loss for the year ended December 31, 2022 was $23.58 Million, which compares unfavorably against a net profit of $3.63 Million reported for the same period in 2021. The decline in profitability was mainly attributable to a 21.58% decrease in Net Interest and Other Income, when compared with the prior year.
As the Company continues on its growth path, it saw an 11% increase in Operating Expenses from $86 Million to $96 Million over the corresponding period in 2021. This, is attributable to the execution of a number of strategic initiatives which included securing a Member Dealer License from the Jamaica Stock Exchange which brought about a 50% increase in regulatory fees. Amplified marketing initiatives to support the strategic position of the Company, including the launch of a new and modern website to better serve FHCIL’s members and clients were also contributed to the company’s performance.
The FHC Retirement Scheme experienced growth in all respects as 92 new members were enrolled when compared with 83 in the prior year. Members’ contribution totaled $155.23 Million which was a 20% increase over the prior year, while net assets available for benefits decreased by 1% to end the year at $1.46 Billion.
Despite the current volatile economic and market conditions, FHCIL remains optimistic for the upcoming financial year as the company continues to execute on the strategic initiatives to diversify its revenue streams. The Jamaica Dollar against United States Dollar appreciation driving short term foreign exchange losses, are unlikely to persist in the medium term and performance is expected to improve as the company builds out the suite of products and services to cater to the investment needs of clients. Furthermore, as asset prices rebound, there is likely to be improvements in income and improved performance from the investment portfolio.
67
OUR STRONG RISK MANAGEMENT CULTURE Loan Risk and Credit Administration
The Credit Union continued its efforts to effectively manage the challenges that arose from the COVID-19 pandemic, by ensuring the application of prudent credit adjudication practices, adapted for the environment. While our delinquency position, particularly for the public transportation portfolio has shown some deterioration, we have consistently adjusted our strategies towards improving the portfolio quality throughout the year. At the close of the financial year the Past Due rate was 10.04%.
The loan portfolio increased from $10.43 Billion to $11.72 Billion, an increase of 12.38% during the year; almost doubling the rate of growth for 2022 over 2021. This growth was driven by the increased demand for Motor Vehicle and Unsecured loans.
During the year we migrated our loan process to a new software platform as a part of our digitization strategy that will deliver improved accessibility, automation, efficiency and provide an overall enhanced member experience and value.
Enterprise Risk Management
Our risk management approach remains a strong part of our culture and a critical ingredient to realizing our Vision and Mission. Therefore we remain committed to and are guided by the principles of sound business practices to ensure value for our members and sustained growth for our Credit Union.
Our overall approach to managing risk is to balance business opportunities with sound risk discipline in order to achieve strategic objectives. Our Enterprise Risk Management Framework objectives remain stringent so as to facilitate the mitigation and management of possible risks. The key objectives are as follows:
1. Oversight: To identify, manage and monitor all critical risks under a holistic approach consistent with Board approved risk appetite.
2. Accountability: To assign ownership of risk to the Management Team who shall be responsible for identifying, evaluating, mitigating and reporting risk exposures.
68
3. Assurance: To provide reasonable assurance to the Board, Management Team, Members and Stakeholders that risk is being appropriately managed within defined levels so as to bring value to the Credit Union.
The principal risks inherent to the activities and business processes of FHC continue to be managed, namely: Strategic, Credit, Compliance, Operational and Financial. Accountability for managing each risk has been assigned to the relevant member of the Executive Management Team.
Anti-Money Laundering and Counter-Financing of Terrorism (AML/CFT)
We remain resolute in ensuring that our team has a thorough understanding of the anti-money laundering and counter financing of terrorism requirements and this is supported through ongoing training and development, to ensure member due diligence and reporting of transactions that are suspected to involve illicit assets or terrorist activities.
Our 2022 initiatives taken to enhance our AML/CFT/CPF capacity and to meet regulatory standards included:
• Strengthening of our existing AML/CFT/CPF controls
• Implementation of new systems and processes to drive our AML/CFT/CPF risks
Business Continuity Plan
Our disaster recovery management efforts remain on-going. Throughout 2022, these included the further development of our Business Continuity Plan (BCP) inclusive of the identification of BCP Champions who are responsible for ensuring that the Departmental level BCP considerations remain up the date and the outlined approaches are effective.
In the event of any significant interruptions to buildings, facilities, systems or employees the Credit Union has designed modalities and approached to efficiently restore the business operations to predisaster levels.
69
Foreign Account Tax Compliance Act (FATCA)
Our subsidiary, FHC Investments Limited (FHCIL) continued to be compliant with its reporting obligations under FATCA.
Common Reporting Standard (CRS)
The Common Reporting Standard (CRS), requires all relevant financial institutions in Jamaica, including FHC to review the tax residency of their members and file information returns to the local Tax Authority. This stems from an agreement entered into by Governments around the world on new measures to encourage financial compliance.
In support of this requirement, FHC, in 2022, engaged new Members, since January 2021 and other applicable Members, to complete a Tax Residency Self Certification Form. Our efforts related to this exercise proved successful and this has been on-boarded as a part of our annual Compliance activities.
Data Protection Act
In light of the imminent implementation of the Data Protection Act by the Government of Jamaica, we commenced preliminary planning to align our business processes and policies to support the changes that will stem from this legislation.
FOCUS ON OPERATIONAL EFFICIENCY
The team remain focused in its commitment to maintain the efficiency levels realized during the previous financial year. The Team of Underwriters managed to maintain an equilibrium, by delighting our membership while still managing to safeguard the Credit Union’s interest.
Our new core banking system, Smart Universa, was successfully on-boarded in February 2022. While the organization worked to address minor pain points that surfaced following the conversion, the overall improved experience that has been realized following the conversion augurs well for the anticipated continuation of enhanced efficiency for the organization.
70
Coupled with this, preparatory initiatives were also undertaken in support of the Credit Union’s Digital transformation journey to develop a roadmap that will guide the organization in establishing the appropriate channels and mechanisms to significantly improve member enablement, and concurrently, support data driven decision making by the organization which should redound to an improvement in our service delivery, product innovation and experience management for Members and Team members.
OUTLOOK
FHC Credit Union’s strong corporate governance and structures have ensured that we continue to build a robust and experienced team that is equipped to both plan and take actions in support of the Credit Union’s sustainability.
Throughout the pandemic, our Leadership team and Team Members, demonstrated a deep sense of commitment to the Credit Union’s success and to meeting our members’ ever-evolving needs.
As we continue to assess our strategic initiatives and how they align with these needs, and our organizational objectives, we will retain our practice of critical assessment of our progress and where necessary, make the adjustments needed. Our Credit Union also retains in focus, the dynamism of our members’ demands along with environmental factors and as such, continue to align with a membercentric core principle, which ensures that each strategic decision at base, addresses our members’ needs and our ability to fulfill them.
Our cultivation of a change culture amongst our team, evidenced through pivotal initiatives such as our core banking system upgrade and digital transformation journey, is timely, and is necessitated by the rapid rate of change in the way we conduct business globally. Concurrently, our team is open to these changes and is at a state of readiness to chart this new path together.
As we burgeon on to new horizons, we have begun to paint the canvas of possibilities with our shared dreams for this institution, and it is our daring spirit that will propel us, knowing that you, our valued Members, continue to place confidence in our ability to deliver.
Together, with a continued core focus on our members, Team Members and enriching the communities we serve, we are committed to our promise to make FHC Credit Union My Place, Your Place, Our Place.
71
GRATITUDE
We remain in gratitude to our members who keep us adequately challenged with new ways in which we can deliver more to serve you. And we certainly could not meet these needs without the commitment of our hard working team. While this year has also had its share of challenges, like any other, we have seen where with your on-going support and our commitment, we have realized many phenomenal feats, of which we are immensely proud.
We take this opportunity to thank all of our members, our Team Members, Board of Directors and Volunteers who have worked tirelessly to make the year a true success, surpassing what we imagined we could accomplish. The fabric of our Credit Union remains one of strength, and with our clear vision, mission and agile approach, we are confident that we will make an enduring contribution to the lives of our Members.
Chief Executive Officer
72
Overview
It is with pleasure, that I present the Treasurer’s Report to the Annual General Meeting of the First Heritage Co-operative Credit Union Limited (FHCCU) for the year ended December 31, 2022. The audited Financial Statements in this Annual Report are for the Group, which comprises the Credit Union and its wholly-owned subsidiary, FHC Investments Limited (FHCIL). The comparative figures in the Financial Statements have been restated to account for deferral of Loan processing fees as per reporting standards.
Summary of Financial Performance
Total revenues of $2.09 Billion grew by 7.83% over the prior year’s outturn of $1.94Billion. Despite a challenging year, FHCCU realized a surplus of $184.25Million compared to a prior year surplus of $188.43Million representing a 2.21% reduction year over year. The subsidiary FHCIL, realized loss of $23.58 Million after taxes, as compared to the prior year’s profits of $3.63 Million. This year’s performance resulted in Accumulated Surplus of $201.97 Million at year end for the Credit Union.
The demand for loans improved within the financial year 2022 and this led to record level disbursements totalling $5.21 Billion relative to $4.17 Billion in 2021 (a 24.94% increase). The Past Due rate on the Loan portfolio edged up to 10.04% from 7.97% last financial year. While deposits grew by 4.91% relative to 11.06% the previous year.
As at December 31, 2022, FHC Credit Union’s Total Assets of $17.19 Billion represented an increase of 4.52% over prior year’s $16.46 Billion, while the Group had Total Assets of $17.36 Billion as compared to $16.55 Billion (2021) or a 4.89% increase.
The Group’s Net Loan portfolio increased by 12.11% or $1.20 Billion over the prior year (2021) from $9.89 Billion to $11.08 Billion. As a consequence the Group’s Liquid Assets and Investments reduced by $469.48 Million (8.56%) to $5.02 Billion as funds were redirected into loans.
73
The graph below indicates the Credit Union’s Investments, Loans and Total Assets for the period 20182022.
Members’ Deposits and Voluntary Shares increased by $652.01Million or 4.91% from $13.27 Billion (2021) to $13.92 Billion (2022). The market for our members deposits have been increasingly competitive and through our retention strategies we have been able to realize a 4.91% increase over the prior year.
74
The graph below indicates the Deposit trend over the period 2018-2022.
Operating Results
The increased appetite for loans by our members and the reinvestment opportunities within our Investment portfolio created improved interest income. The unrealized losses on Equity however adversely impacted our otherwise favourable performances.
The Credit Union’s key results for the year 2022 were:
• Interest Income of $1.94 Billion (2022) increased by $248.06 Million or 14.70% from $1.69 Billion (2021), this was primarily due to the increased earnings from our new loans portfolio and higher yields on re-invested funds.
• Non-Interest Income of $155.18 Million (2022) decreased by $96.16 Million or 38.26% from $251.34 Million (2021). The decrease can be attributed to our equity stock values loss of $21.3 Million vs gains of $11.94 Million in 2021 and one off closure fee income of $41.22 Million.
The graph below depicts the Credit Union’s performance in Interest Income and Non-Interest Income for 2021-2022.
75
• Interest Expense increased to $242.30 Million (2022) from $236.79 Million (2021). This increase corresponds to the continued growth of our Deposit portfolio and significant take up of the Term Deposits which are our primary source of funding. The Credit Union continues to offer some of the most competitive interest rates available to our members on savings products.
• Operating Expenses increased by $120.85 Million or 9.01%, from $1.34 Billion (2021) to $1.46 Billion (2022) however, our Operating Expenses to Average Asset ratio increased to 8.69% from 8.41% in 2021.
• Past Due loans (30 days and over) as a percentage of our Gross Loan portfolio were 10.04% (vs. 7.97% as at December 2021).
• Provision for Loan Losses for the year, net of recoveries was $198.75 Million in 2022, relative to $161.21 Million in 2021. It was necessary to maintain our provisions as the economic circumstances of some of our membership remained dire, increasing the probability of loan default. The provisioning for loan losses continued to be adequate to cover potential losses.
• Accumulated surplus available before distributions decreased to $201.97 Million from $252.55 Million, a reduction of $50.58 Million over 2021.
The graphs below demonstrate the Credit Union’s Revenue and Net Surplus/Deficit performance for the last five years.
76
Economic Overview
According to data from the Statistical Institute of Jamaica (STATIN), the Jamaican economy grew by an estimated 5.20% in 2022, when compared to the similar period in 2021. This buoyant growth led by the tourism sector reflected the continued recovery of the economy from the lingering effects of the Covid-19 pandemic. Despite the challenging market conditions, we remain cautiously optimistic about the future performance of the economy, as the positive growth factors experienced in 2022 are expected to continue into 2023.
The Jamaican dollar appreciated against the United States dollar by 1.96% year over year, ending 2022 at $152.05. This compares to a depreciation of 8.72% in the prior year, where the exchange rate closed 2021 at $155.08. Throughout the year, official data reflected strong growth in the Hotels and Restaurants Sector, however, the strong inflow of tourism earnings was somewhat tempered by the strong demand for US dollar from the manufacturing sector as it rebounded following the lifting of the last restrictions enacted to combat the Covid-19 pandemic. The demand pressures for US dollar during the period were
77
eased by Bank of Jamaica’s active role in the foreign exchange market, selling US dollar via its Foreign Exchange Intervention Trading Tool (B-FXITT) auctions.
Throughout the year, Jamaica’s inflation rate consistently breached the Bank of Jamaica (BOJ) 4% to 6% target range for all twelve months during the period, mainly arising from increased local demand as well as persistent supply chain bottlenecks which spilled over from the war in Europe. As supply conditions eased toward the latter part of the year, inflation moderated from its peak of 11.8% in April to close the period at 9.4% in December. To counteract the effects of the rising inflation, BOJ accelerated the pace of its interest rate hikes and monetary tightening, to bring inflation back within its target. Accordingly, BOJ hiked its policy interest rate from 2.5% at the start of the year to 7% in December, representing an increase of 450 basis points. Similarly, the 90-day benchmark Treasury-Bill rate which started the year at 4.09% moved up to 8.04% at year end.
The latest unemployment figures from STATIN indicated that the Jamaican economy remained resilient despite the headwinds, with labour market conditions improving and unemployment falling to 6.6% in July 2022 compared to 7.10% in October 2021.
Regulatory Environment
FHCCU’s Regulatory Institutional Capital to Total Assets ratio stood at 10.77% as at December 31, 2022 (9.86% in 2021) as our Capital was buoyed by an additional $166.22 Million transfer of retained earnings to Capital approved from 2021 Surplus. This ratio, compared favourably to the minimum PEARLS Standard of 8.00%, and a 6.00% minimum requirement for the Bank of Jamaica.
The Jamaica Co-operative Credit Union League Limited (JCCUL) continues to monitor the Credit Union’s performance against International Credit Union Industry financial benchmark standards, for safety and soundness (PEARLS). Our performance is also compared to other prudential standards by the BOJ.
As a specified financial institution, the BOJ continues to have oversight of our activities by reviewing our financial reports and conducting periodic audits.
78
It is anticipated that the BOJ will soon however assume direct supervision of Credit Unions and in preparation we continue to make the requisite procedural and policy reviews.
Conclusion
Your Credit Union’s performance in 2022 is worthy of accolades, having had to manoeuvre and respond to the lingering effects of the pandemic on our stakeholders both internally and externally. Key prudential ratios such as the Capital and Liquidity positions remained adequate and above benchmark; ratios bolstering our ability to execute on our strategies, always with the ethos of putting our Members at the Centre. As always, the Credit Union’s success is dependent on the continued support of you, our members, our dedicated team members and our volunteers.
Acknowledgements
I would like to gratefully recognise the membership on behalf of the Board of Directors and Management, for their continued support of our Credit Union as we thrive. It has been an honour and privilege to serve you as Treasurer.
We acknowledge the work of our Auditors, KPMG, and their professional contribution to the audit process.
Thanks to all our valued stakeholders especially our Volunteers, Managers and Team Members who unwaveringly applied themselves contributing to the Credit Union’s success, I thank you.
God bless you. ………………………..............................
Cranston Ewan Treasurer
79
80
81
84
85 First Heritage Co-Operative Credit Union Limited Financial Statements December 31, 2022
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144
145
146
147
148
149
150
151
152
153
154
155
156
157
158
159
160
161
162
163
164
165
166
167
168
169
170
171
172
173
174
175
176
177
178
179
180
181
182
183
184
185
186
187
188
189
190
191
192
THE COMMITTEE
The Supervisory Committee assists the Board of Directors in discharging its responsibilities by providing oversight on aspects of the internal control system through the Internal Audit Function.
The members of the Supervisory Committee were elected from the wider membership by the members of the Credit Union at the Annual General Meeting held on the 19th of May 2022. Members Tanisha Thompson, Jacqueline Roberts and Shauna-Kaye Gordon were re-elected. Members Karlene Mitchell-Gordon and Carol Dallas-Robinson were recruited and joined the Committee during the year.
The standing members of the Supervisory Committee are:
Ms. Jacqueline Roberts
Ms. Shauna-Kaye Gordon
Ms. Tanisha Thompson
Mrs. Karlene Mitchell-Gordon
Ms. Carol Dallas-Robinson
The Committee elected Ms. Shauna-Kaye Gordon and Karlene Mitchell-Gordon as Chairperson and Secretary, respectively.
REPORTING PERIOD
The reporting period for this report will cover the twelve month period January 2022 to December 2022.
ATTENDANCE RECORD
There were 12 Supervisory Committee meetings held for the reporting period. The attendance by members is as follows:
193
*Elected May 2022
Members of the Supervisory Committee also attended the quarterly Joint Meeting of the Board of Directors, Committees and Management. The Chairperson also attended the Audit & Risk Management Committee meetings held during the period.
AUDIT AND INVESTIGATION ACTIVITIES
Audit Activities
There were seven (7) audits on the 2022 Audit Plan. Seven (7) audits were completed during the year; five from the 2022 audit plan and two from the 2021 audit plan. The target completion rate was 70%. The actual completion rate was 71%.
The status of audit activities as at the 31st of December 2022 were as follows:
•
•
194 Name Attended Excused Ms. Jacqueline Roberts 12 0 Ms. Shauna Kaye Gordon 12 0 Ms. Tanisha Thompson 12 0 Mrs. Carol Dallas -Robinson* 7 1 Mrs. Karlene Mitchell-Gordon* 8 0
Status Number of Audits Audits Completed audits 7
Audit on controls relating
Tellers’
of
•
to
end
day balancing activities report
Counter-Financing
• Audit on Anti-Money Laundering (AML) And
of Terrorism (CFT) Compliance Review 2021
Review of the Special
Investigation Process
Audit on Debit Card Management
Audit on FHC Investment Company Limited
•
2
(FHCIL) Retirement Scheme
• Audit on Electronic Funds Transfers (EFT)
• Audit on Compliance with Real Estate Appraisal Process
• Audit on Interest Rate Risk Management
• Audit on Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) Compliance 2022 SUMMARY
Audit on Controls Relating to Tellers’ End of Day Balancing Activities Report
This review sought to assess the level of compliance with “End of Day Procedures”. There was a fair level of compliance, however, exceptions were identified during the audit. Reinforcement was done by management regarding the importance of ensuring that the End of Day Procedures were observed. Management has since implemented several corrective actions to strengthen operational controls and to mitigate recurrence.
Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) Compliance Review 2021
This audit assessed the effectiveness of specific AML/CFT controls for the Credit Union and its Subsidiary FHCIL, and a follow up was conducted on the recommendations made by the external reviewers. There was a satisfactory level of compliance, however, exceptions were identified during the audit. All exceptions were corrected during the audit. Approximately, eighty-five percent of the recommendations made by the external reviewer were implemented at the time of the audit.
A review of the actions taken was conducted, in respect of the exceptions noted by Bank of Jamaica in 2021, related to FHC’s Cambio services. At the time of the review some exceptions were addressed, and others were being addressed.
195
In Progress
REPORT ON COMPLETED AUDITS
Review of the Special Investigation Process
A review was conducted on the entire special investigation process, with the intention of improving the efficiency of this process and the members’ experience. The review found that a formal investigation procedure to guide the timelines and deliverables of special investigations was required, and that there was room to reduce the number of visits required by members. The Internal Audit Department and Management Team have committed to working together to improve this.
Review of the Level of Compliance with the Real Estate Appraisal Policy
The primary objective of this review was to assess the level of compliance with the Real Estate Appraisal Policy and procedures. Emphasis was placed on reviewing the policy development and maintenance process, the engagement of valuators, the use of valuation reports during the acquisition and disposal of real estate and the impact on the members’ experience in the real estate loan process.
There was general compliance, however, a few exceptions were noted. Recommendations made by the Internal Audit Department were accepted. These were scheduled to be implemented in 2023.
Audit on FHCIL Retirement Scheme
This audit reviewed the operational procedures of the Retirement Scheme during the period June 2021 to May 2022 and assessed the level of compliance with specific Financial Services Commission (FSC) and AML/CFT regulations.
General compliance was found, however, there were some exceptions noted. The exceptions were corrected before the end of the audit. Recommendations made by the Internal Audit Department were accepted.
Audit on Electronic Funds Transfers (EFT)
The primary objective of this audit was to test the effectiveness of specific controls in place for handling EFT’s relating to member’s request for wire transfers, from initiation to completion. There was one area for improvement identified. The recommendations made by the Internal Audit Department are scheduled for implementation in 2023.
196
Special Investigation Activities
Special investigation continues to be a major activity for the Internal Audit Department. Given the sensitive nature of these activities they are treated as a priority.
For 2022, forty-two (42) special investigations requests were received and 29 investigations were completed. The achievement was a completion rate of 69%, slightly below the target completion rate of 70%.
The major drivers of these investigations relate to unauthorized transactions on debit cards, fraudulent motor vehicle loans and fraudulent cheques.
Approximately $11.3 Million was under investigation during the year. The cost to the Credit Union was approximately $0.5 Million (2021: $6.4Million). The insurance company is currently in the process of finalizing the proceeds pertaining to claims for losses associated with fraud cases.
197
Total Completed Completed In-progress % Completion in 2021 in 2021 Carried forward from 2021 14 - 10 4 71% New cases 2022 28 - 19 9 68% Total cases 2022 42 29 13 69% Total cases 2021 45 31 10 4 69%
GENERAL REVIEWS
Bank Reconciliation Reviews
Based on the reports received, bank reconciliations were reviewed in a timely manner. Some challenges have been identified with reconciling items since the implementation of the new core banking system, however, the IT Department is resolving this issue.
Staff, Volunteer and Connected Party Past Due Loan Balances
There were two connected parties and volunteer loans which were outstanding more than 30 days (past due) as at December 31, 2022.
CONCLUSION
We would like to express our thanks to the Nominating Committee for their confidence in selecting us and the members of the Credit Union for appointing us to serve in this important capacity.
We would also like to express our gratitude to the Management Team and Team Members, in particular the Internal Audit Department and the Board of Directors for facilitating and supporting the work of the Committee over the year.
Shauna-Kaye Gordon Chairperson
198
200
For the financial year 2022, the Credit Union experienced growth in its loan portfolio, despite the challenging business environment and the impact of the COVID-19 pandemic.
In the face of these challenges, the Credit Union continued to meet the financial needs of its members and assist them to achieve their financial and personal goals and is constantly working to consistently exceed its members’ expectations.
The Credit Union’s loan disbursements were good, resulting in a total of $5.22 Billion in 2022 versus a total of $4.17 Billion in 2021.
The loan portfolio grew by 12.38% moving from $10.43 Billion in 2021 to $11.73 Billion in 2022, thereby reflecting the hard work of the team.
The performance of the Micro & Small Business Loans Unit saw disbursement decreasing from $256.82 Million in 2021 to $230.25 Million in 2022, a decrease of $26.57 Million or 10.34%. The Past Due rate increased to 38.80% in 2022, compared to 30.27% in 2021.
Overall Past Due Rate
The rate increased from 7.97% as at December 2021 to 10.04% as at December 2022.
Attendance Record
For the period January to December 2022, a total of forty-seven (47) meetings were held.
Attendance for each member was as follows:
201
Members Meetings Attended No. of Times Excused ALTHEA DALEY* 18RICHARD RANGER* 18STENNETT MCLEAN* 17 1 CLIVIA GREEN 43 4 DONALD WILLIAMS 44 3 KESLYN GILBERT-STONEY** 27 2 JANYCE ROBINSON** 27 2 EARL BAILEY** 13 16 *Retired May 2022 **New June 2022
We encourage FHC members to assist the Credit Union with reducing its Past Due rate, by ensuring loans are repaid promptly. Where there are challenges, we urge you to speak with a member of our team for support.
Donald Williams (Mr.) Chairman
202
In accordance with the provision of the Rules of First Heritage Co-operative Credit Union Limited in respect of Article XIV, Rule 59, a Nominating Committee was appointed which comprised of the following members:
• Mrs. Tamara Riley-Dunn - Chairperson; Board Representative
• Mr. Richard Picart - Member Representative
• Ms. Roxann Linton - Executive Management Representative
The Committee met to consider all retiring Volunteers from the Board of Directors, Supervisory Committee and Credit Committee. The Committee subsequently advertised for Volunteers to fill the vacancies. The candidates were assessed and recommendations made. The Nominating Committee now presents this report to the membership as outlined below:
BOARD OF DIRECTORS
The Directors retiring at this Annual General Meeting are:
1. Mrs. Tamara Francis Riley-Dunn
2. Mr. O’Neil W. Grant
3. Mr. Edmund Jones
4. Mr. Kevin Forbes
5. Ret’d SSP Michael James
6. Mr. Balvin Vanriel
7. Mrs. René Gayle-Roper
8. Mr. Richard Ranger
The Committee nominates the following persons who have all indicated their willingness to serve:
Retiring Recommended
Mr. Richard Ranger
Mr. Richard Ranger
Term (years)
2
203
The following Directors will continue to serve for one year:
The Credit Union wishes to thank our retiring Board Members for their commitment, support and contribution to our success over the years.
SUPERVISORY COMMITTEE
The members of the Supervisory Committee all of whom retire at this Annual General Meeting are:
The Committee nominates the following persons who have all indicated their willingness to serve:
204 New Recruits Recommended Term (years)
Hon. Mr. Justice Evan Brown Hon. Mr. Justice Evan Brown 2 2. Ms. Nickeisha Walsh Ms. Nickeisha Walsh 2
Stefan Richards Mr. Stefan Richards 2
1.
3. Mr.
1. Mrs. Leodis Douglas
2. Mr. Noel Francis
3. Mr. Cranston Ewan
4. Mr. Wayne Jones
5. Mrs. Camelle Ricketts-Moore
1. Ms. Shauna Kaye Gordon
2. Ms. Tanisha Thompson
3. Ms. Jacqueline Roberts
4. Mrs. Carol Dallas-Robinson
5. Mrs. Karlene Mitchell-Gordon
Retiring Recommended Term (years)
Ms. Shauna Kaye
1
1.
Ms. Shauna Kaye Gordon
Gordon
Ms. Tanisha Thompson 1
2. Ms. Tanisha Thompson
Ms. Jacqueline Roberts 1
3. Ms. Jacqueline Roberts
Mrs. Carol Dallas-Robinson 1
4. Mrs. Carol Dallas-Robinson
Mrs.
1
5. Mrs. Karlene Mitchell-Gordon
Karlene Mitchell-Gordon
CREDIT COMMITTEE
The member of the Credit Committee retiring at this Annual General Meeting is:
Mr. Donald Williams
The Committee nominates the following person who has indicated her willingness to serve:
Profiles of Candidates
1. BOARD OF DIRECTORS
Mr. Richard Ranger, RPA, ACCA, CA
Mr. Ranger is a Chartered Accountant, a member of the Association of Chartered Certified Accountants (ACCA) in the United Kingdom and a member of the Institute of Chartered Accountants of Jamaica (ICAJ). He has over fifteen years of experience in external and internal auditing, accounting and business operations. Mr. Ranger has worked with PricewaterhouseCoopers, Boldeck Jamaica Limited and the Neal and Massy Group, specializing in audit and assurance, accounting and income tax services.
He is presently the Principal of Ranger and Associates, a local audit and accounting firm and he previously served as a volunteer in the capacity of a member of the Credit Committee.
Ms. Nickeisha Walsh, ACCA
Ms. Walsh is currently the Executive Director of the Students’ Loan Bureau. She is a qualified Accountant, a Fellow with the Institute of Chartered Accountants of Jamaica and a member of The Association of Chartered Certified Accountants (ACCA).
205
New Recruit Recommended Term (years) Mrs. Althea Daley Mrs. Althea Daley 2
Ms. Walsh possesses over 15 years of accounting and finance experience and has performed on assignments within various government sectors. Her expertise includes accounting, finance, management consulting, human resource management, strategic planning and leadership.
Hon. Mr. Justice Evan Brown, LLB., LLM.
The Honourable Mr. Justice Evan Brown, Judge of Appeal, is a highly accomplished legal professional with a distinguished career in the Jamaican legal system. In 2010 he was appointed to act as a Puisne Judge, a role he held until 2012. He rose through the ranks within the judiciary and was elevated to the post of Judge of Appeal in 2022.
With over three decades of legal experience, the Honourable Justice of Appeal has presided over numerous cases, demonstrating a commitment to the principles of justice and fairness. His extensive legal knowledge and expertise makes him a highly respected member of the Jamaican legal community and his appointment to the Court of Appeal is testament to his dedication and hard work.
Mr. Justice Brown has been an active Member of the Credit Union for over three decades.
Mr. Stefan Richards, MSc.
Mr. Richards is a driven and accomplished professional with extensive experience in international development, finance, and strategy consulting. He is a graduate of SOAS, University of London with a Master of Science in Development Studies (Economics) and a Bachelor of Arts in Economics and French from Vassar College in the United States.
At the Inter-American Development Bank, Mr. Richards served as a trusted advisor to the Executive Director for the Caribbean and the Minister of Finance Jamaica, approving loan and guarantee proposals, shaping the team’s knowledge on private-sector operations, policies, diversity, equity, and inclusion.
206
Mr. Richards’s leadership, analytical skills, and dedication to improving the lives of others have earned him numerous awards and recognition, including being a Rhodes Scholarship 2019 Finalist, a Maguire Fellow, a Distinguished Delegate at the National Model United Nations, a Davis Scholar, and a Shirley Oakes Butler Scholar.
2. THE SUPERVISORY COMMITTEE
Ms. Shauna-Kaye Gordon, MBA, FCCA, CA
Ms. Gordon is presently employed to Sol Petroleum as a Tax Manager and had previously been employed as a Tax Manager with PwC for over five (5) years. She also has eighteen years’ experience working with the Government of Jamaica, in various departments including Tax Administration Jamaica and the Jamaica Customs Department.
Ms. Gordon has extensive knowledge of Jamaican tax laws, international double taxation treaties, and the tax administration system, practices, policies, and procedures. She has provided tax advisory and tax compliance services to clients in the retail, manufacturing, hospitality, banking, insurance and bauxite industries.
She holds a Master’s Degree in Business Administration (MBA) from the Florida International University (FIU) and a Postgraduate Diploma in Tax Audit and Revenue Administration from the Management Institute for National Development (MIND). She is a Fellow of the Association of Certified Chartered Accountants (FCCA) and a member of the Institute of Chartered Accountants of Jamaica (ICAJ).
Ms. Tanisha Thompson, BA, CIA, CISA
Ms. Thompson is an IT Audit/Consulting Professional with over fourteen years of combined expertise in the areas of Information Technology, Operational, Compliance Audits and Business Process Reviews for clients within the manufacturing, banking, insurance, retail and government sectors.
207
She has served both in external and internal audit conducting Information Technology and Security Audits. Ms. Thompson is currently a Director at the Auditor General’s Department, with primary focus on IT Security Audits.
She is a member of the Information Systems Audit and Control Association and the Institute of Internal Auditors.
Ms. Jacqueline Roberts, CA, ACCA
Ms. Roberts is currently an Assistant Audit Manager with the auditing firm BDO Chartered Accountants. She is a qualified Accountant, a Fellow of the Institute of Chartered Accountants of Jamaica (ICAJ) and the Association of Chartered Certified Accountants (ACCA). Ms. Roberts is also a Registered Public Accountant.
She possesses over 25 years of accounting and auditing experience and has performed on assignments within various sectors such as, government, manufacturing, financial, agriculture, retail, non-profit and service organizations.
Mrs. Karlene Mitchell-Gordon, BSc. LLB, MSc.
Mrs. Mitchell-Gordon is currently a Senior Tax Counsel with Tax Administration Jamaica. She is also a practicing Attorney-at-Law, who is well rounded in areas such as accounts, economics and tax reform.
She has held positions such as Legal Counsel & Corporate Secretary, Economist, Accountant and Lecturer and possesses over 20 years of work experience in accounting and tax reform.
Mrs. Carol R. Dallas-Robinson, CA, ACCA
Mrs. Dallas-Robinson is currently an Audit Manager with ABTAX Limited and an Accountant at Caribbean Broilers. She is a qualified as a Chartered Accountant and possesses over 20 years of accounting and auditing experience.
208
In her capacity, she has performed on several assignments within various sectors in the island.
3. THE CREDIT COMMITTEE
Mrs. Althea Daley currently serves as a Consultant with the Jamaica Central Securities Depository. She is an innovative financial service manager with two decades of experience and has successfully managed the merger process of three credit unions. Mrs. Daley has served the credit union movement extensively as she was also a consultant with the Jamaica Co-operative Credit Union League Limited, the Petroleum Industry Employees Co-operative Credit Union, Deputy General Manager for the Montego Co-operative Union Limited and served in the capacity of Manager for both Shell Employees Co-operative Credit Union Limited and Grace Co-operative Credit Union Limited.
Mrs. Daley holds a Postgraduate Diploma in Financial Services Management from the Jamaica Stock Exchange E-Campus and a Bachelor of Science in Management Studies from the University of the West Indies. She has been serving the Credit Union as a volunteer on the Credit Committee since 2014.
Tamara Riley-Dunn Chair, Nominating Committee
Signed By:
Tamara Riley-Dunn Chairperson
209
Ms. Althea Daley
………………………………
August 4, 2023
210 ………………………………………
Member Representative
Staff Representative
10TH AnniversAry
FHC Credit Union celebrated its 10th Anniversary in August 2022 with a cake cutting exercise across all branches to commemorate the occasion. Members as well as team members participated in this significant milestone in the existence of the Credit Union.
212
FHC Civil servAnTs of THe yeAr AwArds 2022
The FHC Civil Servants of the Year Awards 2022 was held at the Tera-Nova All Suite Hotel where eight nominees vyed to be called the Civil Servant of the Year. Three winners were named: for Management Category-Lennox Wallace; Middle Management Category; Oliver Morris and Technical Category-Simone Turton; Sophia Moulton copped the award for the newly introduced People’s Choice Award.
213
CrediT Union week 2022
Credit Union Week was celebrated across the branch network with Members being feted for Members’ Appreciation Day. The celebration also saw Credit Unions coming together to showcase the strength of the movement with their “Evening at the Movies” held at the Carib Theater on International Credit Union Day spearheaded by the JCCUL.
214
fHC invesTmenTs “fireside CHAT” series
Dr. Sara Lawrence Lewis was signed as Brand Ambassador for FHC Investments Limited and as such, has been involved in key activations as Brand Ambassador. With this, the first in a three part series dubbed “FHC Investments Fireside Chat” was held to discuss key elements of preparing for retirement.
215
lAboUr dAy 2022
Labour Day 2022 saw FHC Credit Union team members supporting a number of projects such as painting and cleaning up of schools and other entities. FHC continues to show support as a good corporate citizen by embodying our mandate of impacting communities in which we operate.
216
FHC Awards 2022
The FHC Foundation’s PEP and Tertiary Scholarships handover was held at the ROK Hotel with the CEO of Herboo Botanicals and 2013 recipient of the FHC Entrepreneurship Award, Javin Williams giving the charge to the awardees in his capacity as keynote speaker. Students were awarded based on their academic performances and financial need.
217
JAMAICA CO-OPERATIVE CREDIT UNION LEAGUE LTD.
2022 CONVENTION & 81st ANNUAL GENERAL MEETING HELD JUNE 17 – 22, 2022
HIGHLIGHTS
The Jamaica Co-operative Credit Union League (JCCUL) held its first fully in person annual convention and 81st annual general meeting, since the start of the pandemic, at the Ocean Coral Spring hotel in Trelawny from June 17 to 22, 2022. The convention was held jointly with the Caribbean Confederation of Credit Unions (CCCU), celebrating their 50-year anniversary, at their 64th annual international convention and attracted attendees from credit unions across seventeen (17) Caribbean countries. The theme for the joint convention was ‘Innovation, Integration, Next Generational Leadership’.
JCCUL’s annual general meeting, held on June 18, 2022 under the theme ‘Developing Credit Unions ...Building Jamaica’, was attended by approximately one hundred and forty-five (145) delegates, alternate delegates and observers from Jamaica’s credit unions.
The schedule of activities for the joint convention included an opening ceremony, a trade show, reception and workshops. A description of the activities are below.
FRIDAY, JUNE 17
The following activities took place:
• CEO ROUNTABLE/MANAGERS’ FORUM; Credit Union Managers and League CEOs benefitted from six (6) presentations regarding the status of the credit union movement and ideas to grow and strengthen the movement.
218
The speakers and their topics were as follows:
• Presenter: Harry Davis, Deputy Chief Executive Officer at the Jamaica Business Development Corporation
Topic: Our Future re-imagined
Synopsis: An analysis of the present state of the movement and the use of innovation to modernize the movement to meet the changing needs of future generations
• Presenter: Bruce Bowen, Chief Executive Officer at Advantaq Ltd.
Topic: Caribbean Financial Services
Synopsis: A discussion on issues such as compliance, fraud, cyber security, digitization and the modernization of technology, preparations for natural disasters, future pandemics and tackling changing consumer expectations.
• Presenter: Suzanne Cole, Senior Manager of Risk Assurance at PwC Jamaica
Topic: Enterprise Risk Management: Key Concepts Every Director and Manager Should Know
Synopsis: The importance of proper ERM in building brand and reputation, improving business performance and compliance.
• Presenter: Morvin Williams, Director at the Financial Services Regulatory Commission
Topic: Corporate Governance/Business Continuity
Synopsis: An examination of governance failures in credit unions, the importance and fundamentals of corporate governance, regulatory and supervisory oversight of the governance function.
• Presenter: Dimitri Dawkins, Commercial Director, at Phoenix International, MC Systems
Topic: The Role of Fintech for Financial Service Providers
Synopsis: Driving customer experience through financial technology.
219
• Presenter: Julie Turner, Founder & CEO of HR@Heart Consulting Inc.
Topic: Key Drivers to the Future Success of Your People Operations
Synopsis: Key drivers that engage management and staff to develop a stronger, productive and involved team.
SATURDAY, JUNE 18 – June 21
Participants enjoyed varied presentations aimed at aiding credit unions with deciding their strategic direction and business focus to ensure the growth and continuity of their credit union.
Each presenter’s presentation can be accessed via the following link: https://caribccu.coop/cccuconvention-presentations-jamaica-2022/.
The remaining activities can be viewed via the following link: https://rb.gy/jzpjiq
The list of trade show participants are below.
220
1. Cuna Caribbean Insurance 2. Cumax Wealth Management 3. Quality Network Co-operative (QNET) 4. HomeCU 5. Jamaica Co-operative Insurance Agency (JCIA) 6. IBIS Management Associates 7. Credit Union Brand Engineering (CUBE) 8. Smart Solution 9. Creditinfo 10. ShareTec 11. MC Systems 12. ECHMB Capital 13. CRIF Information Bureau 14. Jamaica Institute of Financial Services (JIFS)
15. TechnoSoft
16. Jamaica Collection & Recovery Services
17. Millennial Vision Inc. (MVI)
18. MSD Emortelle
SATURDAY JUNE 18
JCCUL’s ANNUAL GENERAL MEETING
Approximately one hundred and forty-five (145) credit union delegates attended the 81st annual general meeting.
President Mr. Lambert Johnson, chaired the meeting. He welcomed the participants and then gave a summary of the Board report for the year 2021. All other reports including that from the Treasurer, the Supervisory and Nominating Committees, as well as the audited financial statements were presented.
Distribution of Surplus
The Delegates agreed to the distribution of the surplus of two hundred and seventeen million and nine hundred thousand dollars ($217.9 million).
The Delegates voted for the maximum liability of the League to be set at $5 billion.
ELECTION OF OFFICERS
The Meeting voted to accept the nominations for the following persons to fill vacancies on the JCCUL Board.
221
Name
Credit Union
Martin Blackwood Portland
Category
CU Managers Rep.
Andrea Messam Broadcast & Allied Small
Alexander Bourne Manchester Medium
Patrick Smith JTA
Winston Fletcher EduCom
Ryan Muir Lascelles Employees & Partners
At Large
At Large
At Large
Bornette Donaldson C&WJ Large
The following persons were elected to serve on the Supervisory Committee:
NAME Credit Union
Mary Elizabeth Dick
Ricardo Jones
Karen Robotham-Teape
Nicola Reid
Snr Supt Paulette Green
RESOLUTIONS
JTA Co-operative Credit Union
COK Sodality Co-operative Credit Union
Broadcast & Allied Services Co-operative Credit Union
Palisadoes Co-operative Credit Union
Jamaica Police Co-operative Credit Union
Seven (7) resolutions were passed at the meeting as follows:
Anniversary congratulatory resolutions
• Broadcast & Allied Services Co-op Credit Union – 70th anniversary
• Jamaica Co-operative Credit Union League – 80th anniversary
222
Congratulatory resolutions
• NCB Employees Co-op Credit Union – Joan Fay Garfield, JP
• Postal Co-op Credit Union – Joereen McLean
• Trelawny Co-op Credit Union – Winston Tomlinson
Condolence Resolutions
• COK Sodality Co-op Credit Union – Albert ‘Bertie’ Morris
• Jamaica Police Co-op Credit Union – David Weston Rowe (AKA Moonie)
RULE CHANGES
There were no rule changes.
Following the AGM the executive was elected to serve on the League Board for the 2022-2023 year:
Lambert Johnson - President
Andrea Wilson-Messam - 1st Vice President
O’Neil Grant - 2nd Vice President
Norris Gilbert - Treasurer
Ryan Muir - Assistant Treasurer
Lt. Col. Michael Anglin - Secretary
Alexander Bourne - Assistant Secretary
Brenda Cuthbert
Bornette Donaldson
Winston Fletcher
Jerry Hamilton
Anthony McLaughlin
Patrick Smith
Hector Stephenson
223
The Credit Union Awards were announced at the Annual General Meeting. The awardees are as follows:
AWARDS
Large
Winner EduCom Co-operative Credit Union
Runner Up First Heritage Co-operative Credit Union
Medium-sized
Winner Portland Co-operative Credit Union
Runner Up Palisadoes Co-operative Credit Union
Small Winner Lascelles Employees and Partners Co-operative Credit Union
Runner Up BJ Staff Co-operative Credit Union
Other Credit Unions that won prizes were:
• Portland Co-operative Credit Union
• JDF Co-operative Credit Union
• First Heritage Co-operative Credit Union
Other prizes:
- Highest Asset Growth
- Highest Solvency
- Highest Net Capital Growth
• CPD Online Top Performing Credit Union- NCB Employees Co-operative Credit Union
• CPD Online Top Performing Credit Union (1st Runner up) – Lascelles Employees and Partners
Co-operative Credit Union
• CPD Online Top Performing Credit Union (2nd Runner up) – Public Sector Employees Co-operative Credit Union
224
• CPD Online Top User – Sherry Ann Scott (First Heritage Co-operative Credit Union) The convention ended officially on Tuesday June 21, 2022 with a Grand Finale Ball.
Delegates
…………………………………………………...
Leodis Douglas
Delegates
225
BRANCHES ADDRESS BRANCH MANAGERS
Kingston & 8-10 Eureka Road
Melissa Miller-Benjamin
St. Andrew Kingston 5 Senior Branch Manager
Lawrence Tavern Lawrence Tavern P.O. St. Andrew
20 Dominica Drive
10 East Avenue
Kingston 4
Racquel Walker
Trudian Stewart
St. Catherine
Lot 57 West Trade Way
Portmore Town Centre
Unit 13
Oasis Shopping Centre
6 March Pen Road
Spanish Town
Shops 8 & 9, East Side Plaza
35 East Street
Old Harbour
Tania Oglesby
Sheldon Christian
St. Thomas
26 Queens Street
Morant Bay
Aljay Cole
Clarendon
Shops 5 & 6
Bargain Village Plaza
May Pen
Norman Williams
Manchester
2 Perth Road
Mandeville
Sharna Hutchinson-Scott
226
Garfield Pearson
Senior Manager - Accounting & Treasury
Sophia Harvey
Manager - Human Resource Development
Rosemarie Samuels Manager - Training and Development
Jason Ferguson Manager – Micro & Small Business Loans Unit
Alleesa Matherson Manager - Centralized Loans Unit
227
St. James
21 Union Street Marcia Bailey Montego Bay
1. ORDER OF BUSINESS
An agenda shall be prepared by the Chairman and Secretary, and all items. Thereon shall take precedence over all other business. Any member desirous of introducing business for the consideration of the meeting may do so after the business on the agenda has completed, or may give notice of motion to be discussed at a further meeting.
2. SUSPENSION OF STANDING ORDER
In the event of any matter of urgency, however, the Chairman may accept a suspension of the Standing Orders. The member moving such suspension must clearly state the nature and urgency of his business, the numbers of the standing orders affected, and the length of time he desires such suspension to last. At the option of the meeting, a further extension may be allowed, but no suspension shall take place except by majority vote of the members present.
3. MINUTES
No motion or discussion shall be allowed on the Minutes except in regard to their accuracy. After the confirmation of the Minutes, they shall be signed by the Chairman, and the members shall then be at liberty to ask any questions in regard to matters arising out of them. Such questions shall be allowed for purposes of information only, and no debate on the policy outlined in the Minutes shall take place.
4. All persons desiring the floor shall rise and address themselves to the Chair. They shall state their name and the Credit Union which they represent, if recognized by the Chair, they shall have the privilege of the floor and all the rights thereof.
5. All speakers are to make use of the Desk and Floor Microphones when addressing the Meeting in order that it be recorded and made a permanent record in the Meeting Proceedings.
6. Should two or more persons rise at the same time, the Chair shall decide, without debate, who is entitled to the floor.
7. SPEECHES
No member shall be allowed to speak more than once upon on any motion before the meeting, unless in Committee, or on a point of order, or explanation, except the mover of the Original Motion. But on an amendment being moved, any member even though he has spoken on a Original Motion, may speak again on the amendment. No member shall speak for more than five minutes at a time. Members wishing to raise points of order or explanation must first obtain the permission of the Chairman and must raise immediately the alleged breach that has occurred. Any member may
229
formally second any motion or amendment and reserve his speech until a later period in the debate.
8. No person shall interrupt another who is speaking except on a point of order, a parliamentary inquiry, or a point of information.
9. If it should come to pass that a speaker is called to order while speaking, the speaker should take his seat until the question of order is determined.
10. CHAIRMAN’S RULING
The ruling of the Chairman on any question under the Standing Orders, or on points of order or explanation, shall be final, unless challenged by not less than four members, and unless two-thirds of the members present vote to the contrary.
11. INTERRUPTION
If any member interrupts another while addressing the meeting, or uses abusive or profane language or causes disturbance at any of the meetings, and refuses to obey the Chairman when called to order, he shall be named by the Chairman. He shall thereupon be expelled from the room and shall not be allowed to enter again until an apology satisfactory to the meeting be given.
12 A question shall not be subject to debate until it has been duly moved and seconded and is stated from the Chair.
13. MOTIONS AND AMENDMENTS
The first proposition on any particular subject shall be known as the Original Motion, and all succeeding propositions on that subject shall be called amendments. Every motion or amendment must be moved and seconded by members actually present at the meeting before they can be discussed, and, wherever possible, should be set forth in writing. It is permissible for a member to make his speech first and conclude with a motion. When an amendment is moved to an Original Motion, no further amendment shall be discussed until the first amendment is disposed of (Notice of any further amendment must be given before the first amendment is put to the vote).
14. SUBSTANTIVE MOTIONS
If an amendment be carried, it displaces the Original Motion and itself becomes the substantive motion, whereupon any further amendment relating to any portion of the substantive motion may be moved, provided it is consistent with the business and has not been covered by an amendment or motion which has been previously rejected. After the vote on each succeeding amendment has been taken, the surviving proposition shall be put to the vote as the main question, and if carried shall then become a resolution of the meeting.
230
15. RIGHT OF REPLY
The mover of the Original Motion shall if no amendment be moved, have the right of reply at the close of the debate upon such motion. When an amendment is moved he shall be entitled to speak thereon in accordance with Standing Order No. 8 and at the close of the debate on such amendment shall reply to the discussion, but shall introduce no new matter. The question shall then be put to the vote immediately, and under no circumstances shall any further discussion be allowed once the question has been put from the Chair. The mover of an amendment shall not be entitled to reply.
16. WITHDRAWALS OR ADDITIONS
No motion or amendment which has been accepted by the Chair shall be withdrawn without the majority vote of the meeting. Neither shall any addendum or rider be added to a motion which has once been accepted by the Chair without majority vote. Should any member dissent, the addendum must be proposed and seconded, and treated as an ordinary amendment.
17. CLOSING DEBATE
The motions for the previous question, next business, or the closure, may be moved and seconded only by members who have not previously spoken at any time during the debate. No speeches shall be allowed on such motions. In the event of the closure being carried, the mover of the Original Motion shall have the right to reply in accordance with Standing Order No.16 before the question is put. Should any one of the motions mentioned in this Standing Order be defeated, thirty minutes shall elapse before it can be accepted again by the Chairman, unless he is of the opinion that the circumstances have materially altered in the meantime.
18. ADJOURNMENT
Any member who has not already spoken during the debate may move the adjournment of the question under discussion, or of the meeting, but must confine his remarks to that question and must not discuss any other matter. The mover of the motion upon which the adjournment has been moved, shall be allowed the right to reply on the question of the adjournment, but such reply shall not prejudice his right of reply on his own motion. In the event of such motion being lost, it shall not be moved again, except in accordance with Standing Order 18.
19. Any member may call for a division of the House (that is, for a roll call vote) when there appears to be a reasonable doubt as to the accuracy of the vote as announced by the Chair.
20. A motion to lay on the table shall be put without debate.
21. Whispering, loud talking, or other disturbances calculated to disturb anyone while speaking will not be tolerated.
231
Celestine Howell
Beverley Bennett-Tucker
Lucille Francis
Dorett Osbourne
Claude Walford
Kriston Malcolm
Sonia Turner
Junior Bennett
Susan Barton-Henry
Jenevia Brown-Scott
Donna Burton-Henry
Esmin
Gooden
Brian Andrews
Cassandra Hall
Mernal Baker
Karlene Esson
Hyacinth Edwards
Winston Blagrove
Paul Thompson
Daniel Farquharson
Marjorie Harrison
Michael Reynolds
Diana Lothian
Camila Masters
Norma Anderson
Sydney Wareham
Dezreene Irons
Winston Stewart
Lucille Knight-Green
Minette Meredith
Cordella Folkes
Slyvia Esson
Jevaun Taylor
Janice Knibbs
D’Andra Wilson-Walters
Winsome McDonald
Delores Williams
Early Cole
Oneilia Smith
Albert Bailey
Alice Hendricks
Albert Bailey
Carole Deans- Campbell
Delroy Scarlett
Maud Anderson
Leroy Fearon
Cuthbert Hyman
Shemiah Rowe
Marlene Braham
Renford Smith
Velma Brown
Notoya Bryan
AnnMarie Bryan-Case
Ainsworth Brown
Barrimore Thompson
Isabell Walker
Elaine Laidley
Oneil Chambers
Junel Grant
Shamona Wqignal
Sophia Scott
Verna-lee Barclay-Beckford
Stephanie Hunt
Charles Jackson
Hortense Raymond
Patricia Forrester
Denise Gordon
Taaroy Thompson
Neville Coley
Donna-lee Wright
Leroy Henry Donovan Wellington
Nelucia Lumbly
Albert Wilson
232
Enid Bremmer
Arthur Raymond
Edward Ayton
Dalton Spence
Shirley Pinnock
Boyd White
Milton Webber
Broslloyd Campbell
Taussent Lawrence
Jean Mills
Taneshia Foster
Wesley James
Kacey-Ann Hill
Violet Hudson-Freeburn
Jahvari Brown
Godfrey James
Carol Beverley
Sheryl Golding
Merlene Thomas
Ersylin Frue
Ruth Thompson
Monica Panton
Tomlin Castro
Maxine Bell
Rose Campbell
Eunice Lewis
Peter Findlay
Denese Webster
Alvena Watson
Dorothy Doeman
Marline Cunnison
Evett Cross
Luceta McDobie-McIntosh
Hernel Ricketts
Oliveir Goode
Tanique Berry
Sonia Webster
Donovan Johnson
David Shields
Carol Scott
Melford Brown
Eulalee Watson
Celia Whyte
Michelle Buckley
Moreen Johnson-Bryan
Jacques Powell
Keith Hunter
Garnette Beecher
Nilroy Thomas
Martin Barnett
William Cleary
Sandra Daley
Lemuel Keith
Rayon Beckles
Gillett Creary
Wilhel Denton
Orville Robinson
Walford James
Doreen Edwards
Juliette Thompson
Ephraim Lowe
Chizzlewitt Schooler
Li-Shann Jackson
Ukel Carey
Sylvia McGregor
O’neil Martin
Muriel Christie Desmond Rowe
Alfred Campbell
Janet Dunphy
Murline Hall
Eualee Findlay
Henry Powell
Sheila Holder
233
Noel Dunn
Hyacinth Fairman
Patricia Waldron
Simon Brown
Annette Gayle
Keisha Peart
Marlene Lindsay
Charles Leslie
Claude Caudeiron
Norris Martin
Annette Seymour
Dave Brown
Rainford Tingling
Felecia Streete
Winston Afflick
Geoffery Reid
Lisa Levy
Janet Haynes
Glenford Moulton
Samuel Brown
Fay Graham
Esther Cooper
Carmen Bonner
Tiyana Ewart
Rolston Bennett
Constance Chen
234
Lord, make me an instrument of thy peace.
Where there is hatred, let me sow love;
Where there is injury, pardon;
Where there is doubt, faith;
Where there is despair, hope;
Where there is darkness, light; and
Where there is sadness, joy.
O Divine Master, grant that I may not
So much seek to be consoled as to console;
To be understood as to understand;
To be loved as to love.
For it is in giving that we receive;
It is in pardoning that we are pardoned; And it is in dying that we are born to eternal life.
Amen
235
